The recent Bengal Global Business Summit held on November 21st and 22nd in Kolkata gathered 250 delegates from 28 countries alongside prominent Indian industrialists. Chief Minister Mamata Banerjee revealed investment proposals totalling `3,76,288 crore, marked by the signing of 188 Memorandums of Understanding (MoUs) and Letters of Intent (LoIs). This event witnessed a substantial leap from the previous year, which had 137 MoUs and a total investment proposal of ` 3,42,375 crore.
Reality of Investment Proposals
Although numerous MoUs and LoIs are signed during such summits, the actual investment often falls short. This trend is observable not only in West Bengal but also in states like Gujarat and Uttar Pradesh. Hastily signed agreements and the allure of government incentives can lead to a disparity between proposed and realized investments. The competitive global investment landscape presents challenges such as securing affordable finance, timely environmental clearances, uncertain future sales, technology acquisition, and currency fluctuations, limiting the execution of proposed investments.
India’s Economic Landscape
India, amid global uncertainties since the 2007-08 financial crisis, witnessed fluc- tuations in growth rates. Post-demonetization in 2017 and the subsequent pandemic, India & World faced economic slowdowns. Presently, government-led infrastructure investments drive India’s growth, while private investments remain subdued. Reports indicate impressive bank credit growth in personal and retail loans but highlight a mere 6.1% bank credit allocation to industrial investment. Industrial growth has recently eased, notably in real estate and passenger car sales, primarily higher-priced segments.
Challenges and Hope in Sectors
Sales surges in high-value segments of real estate and SUVs contribute to market growth, while affordable housing and two-wheeler sales witness declines. The agricultural sector displays notable growth, but rural demand post-pandemic remains subdued. In the recent summit, emphasis on Micro, Small & Medium Enterprises (MSMEs) presented a promising direction, aligning with the state’s strengths and needs.
The summit highlighted significant partnerships and initiatives. MoUs were signed for skill development, strategic trade partnerships, educational collaborations, and shipbuilding ventures. Focus areas included labour-intensive sectors like leather and garment industries, offering glimpses of optimism for West Bengal’s prospects. The event signalled a substantial leap in proposed investments, aligning with the state’s emphasis on MSMEs and showcasing partnerships across diverse sectors.