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The Pinocchio State

 Omkar Goswami


Let me share with you some facts about an Indian state that is supposed to have achieved the one of the most impressive growth rates over the last decade. Until the end,  I won’t let you in to the name of the state, but will call it the Master Blaster in honour of the uncanny precision with which Sir Don Bradman scored his runs; and you must promise that you won’t let your eyes stray to the bottom of this article. What I would like to demonstrate is that the ‘official’ GDP growth estimates of this state are not only out of synch with statistical patterns that one normally expects with such data, but also don’t square up with other evidence.


As we all know, economies have their ups and downs. Today, we are lauding India’s GDP growth of 6.9% in 2004-05 coming on the back of 8.5% in 2003-04. Equally, however, 2002-03 was a relatively poor year, when growth fell to 4%. In fact, if one were to track the progress of GDP growth since 1993-94, it would be a bit like a yo-yo: above 7% growth for the first three years; then down to 4.8%; then up to the 6.1% to 6.5% range for the next two; then down to 4.4%; rising to 5.8%; only to fall to 4%; and finally increasing first to 8.5% and then a bit lower to 6.9%. That’s how economies generally behave — some excellent years, some average and some poor. The only exception in the 1990s has been China — and, despite its fondness for the colour red, the Master Blaster state is no China.


Statistically, for the period 1993-94 to 2003-04, the average GDP growth for India has been a bit over 6%. But, given its ups and down, the standard deviation — or more simply the variation around this average — has been 1.5%. That’s normal, and to be expected.


Now consider the Master Blaster state. Between 1993-94 and 2002-03, it claims to have clocked the second highest inflation adjusted GDP growth among all states in India — an average of 6.8% per year over these ten years. But that’s not all. There is almost a precision about the annual growth rates: 6.8%, 7.4%, 7.0%, 8.3%, 6.4%, 6.9%, 6.4%, 7.2%, 6.9%. Even when the country as a whole was going through a lean patch, Master Blaster’s growth rate never dropped below 6.4%. Thus, not only has this state clocked the best  growth after Gujarat, but it also had the lowest standard deviation of 0.6%. In other words, the deviation in growth of India as a whole over the same period was 2.67 times that of the Master Blaster state.


Its fascinating to compare this state with those that we generally consider the more prosperous, faster growing ones. Master Blaster’s average growth for period was 6.8%; Maharashtra’s was 5%; Tamil Nadu’s 5.2%; Andhra’s 5.5%; Haryana’s 5.9%; and Kanataka’s 6.3%. Only Gujarat did better by achieving an average growth of 7.5%. Each of these states had their ups and downs. Thus, Maharastra’s standard deviation was 7.3 times that of the Master Blaster; Tamil Nadu’s 6.7 times; Andhra’s 6.3 times; Haryana’s 5.1 times; Karnataka’s 6.3 times; and Gujarat’s 11.5 times. Compared to these states, Master Blaster was steadiness personified. Second highest average growth with the lowest possible deviation from the average. Who can ask for anything more?


The rulers of the Master Blaster state have consistently claimed that the growth miracle has occurred because of agricultural prosperity arising out of systematic land reforms from the late 1970s through the 1980s. If that were so, we ought to expect significant betterment in rural real expenditures as well as in the ownership and use of assets and amenities. Statistics and standard deviations aside, this is where things begin to unravel.


Here are a few nuggets. According to the data collected by the National Sample Survey (NSS), in 1999-2000, over 31% of the rural populace of this state were below the poverty line — worse tan the national rural average of 27%. The average per capita rural expenditure of the state was the sixth lowest in the country, and not much different from that of people in Assam, Madhya Pradesh, Bihar or Orissa. According to the 2001 Census, only 13% of rural households owned TVs, which was below the national rural average of 19%. Only 25% of rural households of that state had permanent (or pucca) houses in 2001, versus an all-India rural average of over 41%. A mere 20% of the state’s rural households had electricity connection in 2001, compared to a national average of 43.5%. In terms of expenditure as well as the ownership of basic assets and amenities, the Master Blaster state has been at the bottom of the pack — with Orissa, Bihar, Assam and occasionally Madhya Pradesh and Chhattisgarh for company.


Here lies the rub. The official data published by the state is showing it to be the second most powerful growth engine of the nation — not only in term of growth rates but also in their sheer constancy. Moreover, the rulers claim that this growth has been driven by agricultural reforms. Yet, the rural heartland of the state is abysmally poor in terms of expenditure, assets and amenities. So, what is true?


The state is West Bengal.


 Published: The Times of India, May 2005


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