Bengal will buck the contraction in the economy and post a modest growth despite the Covid-19 induced deceleration witnessed across the globe, state finance minister Amit Mitra said on Monday.

While India’s GDP is apprehended to contract 7.73 per cent in 2020-21, the state is likely to grow 1.2 per cent, he said.

“(According to) the latest data on advance estimate.. which is with the government of India, Bengal will not only not shrink, but will grow by at least 1.2 per cent. It may even be higher than that,” Mitra told industry representatives whom he addressed virtually.

Bengal has been outperforming the country in terms of growth in the last few years, in part because of the low base. While the national GDP grew 4.2 per cent, state GSDP went up 7.6 per cent in the last fiscal.
While he did not offer an explanation on how this enviable feat would be achieved, Mitra appeared to be heavily banking on the micro, small and medium sector to do the heavy lifting for the state’s economy. An important trading hub for the East and the Northeast, the state has been witnessing growth in bank lending to the MSME sector.

Mitra said the target for this year was to lend Rs 90,000 crore before the pandemic roiled the economy. “Banks sanctioned Rs 50,000 crore till December. I would not be surprised if the final figures go up to Rs 70,000 crore by the end of this fiscal,” Mitra said.

Mitra informed that the state budget this year increased capital expenditure, which goes into creating assets (infrastructure), by 100 per cent.“Bengal will get the highest revenue deficit grant from the Fifteenth Finance Commission. The state will get Rs 40,000 crore in the next four years, including Rs 17,500 crore alone this year,” he said.