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The Fiscal Landscape of West Bengal: Performance, Challenges and a Roadmap for Consolidation

Author

Listed:
  • Anil K Sharma

    (National Council of Applied Economic Research)

  • Aswathi Nair

    (National Council of Applied Economic Research)

  • Arjita Chandna

    (National Council of Applied Economic Research)

Abstract

West Bengal is one of India's largest states, accounting for around 7.1 percent of the country's population and about 5.5 percent of national GDP. Although its economy is larger than that of many states and consistently ranks among the six to eight largest state economies, it remains smaller than those of leading economic states such as Maharashtra, Tamil Nadu, Karnataka, and Gujarat. This study examines West Bengal's fiscal landscape by assessing its fiscal performance, identifying the key challenges to fiscal sustainability, and outlining a roadmap for fiscal consolidation. The analysis benchmarks the State against the average performance of All States and the neighbouring State of Odisha, with particular emphasis on the composition of receipts and developmental expenditure, the evolution of deficits and debt, and compliance with the provisions of the Fiscal Responsibility Act. Based on the analysis carried out in the study it suggests ways to mobilising resources (both tax and non-tax), rationalising subsidies, managing committed expenditure to expand capital investment, and strengthening fiscal prudence to improve fiscal resilience and create greater capacity to finance future development priorities.

Suggested Citation

  • Anil K Sharma & Aswathi Nair & Arjita Chandna, 2026. "The Fiscal Landscape of West Bengal: Performance, Challenges and a Roadmap for Consolidation," NCAER Working Papers 192, National Council of Applied Economic Research.
    • Handle: RePEc:nca:ncaerw:192
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    JEL classification:

    • H62 - Public Economics - - National Budget, Deficit, and Debt - - - Deficit; Surplus
    • H63 - Public Economics - - National Budget, Deficit, and Debt - - - Debt; Debt Management; Sovereign Debt
    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
    • H75 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Government: Health, Education, and Welfare
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism

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