NEW DELHI: Trinamool Congress-ruled West Bengal, all through the downturn and even otherwise, has been making the highest annual contribution to the Centre through the small savings schemes to fund many of its welfare and infrastructure projects. In the last three-and-a-half years, West Bengal has contributed over Rs 1 lakh crore.
West Bengal's contribution through small savings, collected by the network of post offices, was more than Rs 33,000 crore in 2010-11, though it came down in the last two years. Nevertheless, it remained above Rs 24,000 crore a year, more than any other state.
Small savings schemes are majorly used to fund the Centre's social sector schemes and other welfare activities. The money collected through these schemes have long repayment schedules and helps the government use them as long-term funding options for many of its big-ticket infrastructure projects. About 50% of the net collections under these schemes are provided to states as soft-term loans for building roads, hospitals and other community assets.
Finance minister P Chidambaram's confidence of a high savings rate of 31.3% in 2011-12 and 30% in 2012-13 has been a result of the consistent high contributions of some of states in small savings schemes. India's impressive investment rate of 35% is also dependent largely on how its saving rates are.
After West Bengal, UP leads the pack among highest contributors. In the last over three-year period, the state's small savings have contributed Rs 89,000 crore, followed by Maharashtra and Gujarat. The Narendra Modi-led Gujarat has been at No.4 position in terms of small saving contributions which is in the range of Rs 15,000-Rs 19,000 crore annually.
Gujarat's lower contributions than UP and Bengal could also be for the reason that the state is one of the major investors in security market and other corporate saving schemes available. In states like West Bengal, Bihar and UP, small investors prefer savings in post office schemes which have assured return and are considered secured investment as these funds are invested in government securities.
Bihar is also among one of the highest contributors in small savings with annual contributions of more than Rs 10,000 crore, better than Delhi and Punjab. Contributions from Tamil Nadu is in the range of Rs 10,000 crore and Rs 13,400 crore; and that of RajasthanBSE 1.80 % has been in the range of Rs 9,600 crore and Rs 11,000 crore. Punjab's contributions have been in the range of Rs 10,000 crore.
Source : http://economictimes.indiatimes.com