Productive Expenditure vs. Unproductive Expenditure in WB: A Glimpse

 For the welfare of the people the Union Government or State Government has to incur expenditures. The expenditures are important for the development of an economy. There are two types of expenditures incurred by the Government – one is Productive and other one is unproductive. In general productive expenditures increase productive capacity in the economy and bring income to the government. Some examples are expenditure on infrastructure development, public enterprises or development of agriculture etc. which increase productive capacity in the economy and bring income to the government. On the other hand, unproductive expenditures means which do not create any productive asset or can bring income or returns to the nation. As examples few are interest payment, donations to clubs, and allowances to religious leaders etc. Unproductive expenditures arise because of many factors, including uncertainties, the lack of a well-trained civil service, inadequate checks and balances in the political and budgetary process, and corruption. In this article, few cases are presented with supporting data about the unproductive expenditures in West Bengal.  

  In West Bengal unemployment is serious now. The data collected from the Centre for Monitoring Indian Economy (CMIE) speaks the truth. In January 2016 West Bengal had an unemployment rate of 9.0 percent against the all India average of 8.7 percent. In May 2021, the unemployment rate in the State was 19.3 percent against the all India average of 11.9 percent. And in the month of June 2021 the same (unemployment rate) in West Bengal was 22.1 percent against all India average of 9.2 percent ( On the other hand the State Government has been spending more and more on unproductive expenditures. The Government of West Bengal had given more than Rs 1,300 crore to various clubs across the State which is purely an example of unproductive expenditure; of course, it may fetch an easy vote. “In 2012, one year after coming to power, the State Government had given an amount of Rs. 2,00,000 to 26,000 clubs across the State. Since then, these clubs have received grants worth Rs. 1,00,000 every three years” (NEWS Click, 14 Mar 2020). In the month of August 2021, a very unfortunate incident took place in West Bengal. The teachers who are great assets to the society were dealt badly by the concerned authority as sequel five women teachers consumed poison as suicide attempt. Why teachers were badly treated in a State which is considered as ‘Culturally advanced’. Another example of unproductive expenditure is allowances to the religious leaders. Recent case of unproductive expenditure is the launching of Lakshmi Bhandar Scheme. The Scheme provides basic income support to the female heads of the family. Through this scheme, the Government is going to provide Rs 500 per month to general category families and Rs 1000 per month to SC/ST families.

With so many unproductive expenditures involving huge amounts of money, I am worried about the future of West Bengal in the economic front as with the huge unemployment rate both in absolute number and relative terms the people of the State may suffer from law and order issues in the near future.

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