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Comparison challenge in industry math

Calcutta, June 10: Investment catalysed, industrial projects implemented/under implementation and project proposals — finance minister Amit Mitra has sprung three yardsticks but the moot question on the state’s performance in attracting investment remains shrouded in mystery.

During the question-answer session in the Assembly, Mitra was asked a question and two supplementary questions on how many agreements on new industries had been signed, work on how many of them had begun and whether the government had an industrial employment-generation roadmap.

A Presidency alumnus who was taught by Amartya Sen, Manmohan Singh, K.N. Raj and Sukhamoy Chakraborty, Mitra rolled out a set of numbers, which if compared with the contents of his budget speech and other documents, can throw even a trained economist into a tizzy. (See chart)

Take for example the cumulative figure of projects implemented/under implementation between June 2011 and January 2014, which, according to Mitra’s answer today, stands at Rs 78,092.82 crore.

But according to Economic Review, 2012-13, the state government has catalysed investments worth around Rs 2,777.7 crore in 2011 and 2012.

As there was no column on projects under implementation for these two years, it may give the impression that projects worth Rs 75,315.12 crore were implemented or were under implementation in the 2013 calendar year.

“There seems to be no continuity in the numbers. We are getting investment figures under different heads, which make it difficult to compare the state’s performance over the years,” said Surjya Kanta Mishra, the leader of the Opposition in the House.

The CPM’s Mishra, a doctor, had come under attack from Mitra on March 16, 2013, for his apparent lack of knowledge in economics. The finance minister had said: “Please don’t undermine (John Maynard) Keynes…. Dr Mishra, you are a doctor. So, how will you know about this?”

But when The Telegraph spoke to some city-based economists today about Mishra’s concerns, they echoed the former health minister.

“All major Indian states have their respective statistical bureau or bureau of applied economics and statistics, which collate and publish data in a general format so that state-level and CSO (Central Statistical Organisation) data can be compared. This is done to ensure continuity in data collection and their comparability,” said a Calcutta-based economist, who did not wish to be named.

“It is impossible to compare how the state has fared in attracting investments if there are three different sets of yardsticks,” he added.

When Mitra was contacted by this newspaper later in the day, he said: “I was asked ‘koto abedan esche (how many industrial investment proposals have come?’ I gave out the figure. Additionally, I also said how much investment was either completed or was under implementation. This is the real number as it reports things taking place on the ground.”

However, there was no explanation on why investment catalysed — a clear indicator of investment performance in a year — was replaced with projects implemented/under implementation in Economic Review, 2013-14.

A project is said to be under implementation when land has been acquired, the boundary wall made, plant and machinery put up or trial production started. This results in flow of investment.

“One can club together projects implemented and is under implementation as it captures the pace of industrialisation, but there should be a demarcation for the sake of comparability. That has not been done,” said an economist.

Since coming to power, the Trinamul government has not stuck to a format while presenting numbers. Mitra’s 2012 budget speech had mentioned that the state had received investment proposals worth Rs 80,000 crore since May 2011.

The figure swelled to Rs 112,769.36 crore in Mitra’s budget speech last year although then industries minister Partha Chatterjee never disclosed the list of new projects queuing up at Bengal’s doorstep.

After Mitra took over the reins of the industries department during a shuffle in December 2013 — widely seen as the result of Chatterjee’s non-performance — the budget of 2014 did not mention proposal figures at all.

Today, Mitra put a number to the proposals received in 2013-14 at the Assembly and later claimed that this was the first time he was announcing this number. “But the question is what should we compare it with?” asked Mishra.