Mamata Banerjee and Pranab Mukherjee after their meeting on Sunday. (Sanat Kumar Sinha)
Calcutta, May 29: Pranab Mukherjee promised Bengal the ?required assistance? from the Centre to tide over its financial crisis after a 40-minute meeting with Mamata Banerjee this evening.?The financial situation in Bengal is critical. Some short-term and certain long-term measures are required to be adopted to get out of this. The Bengal government will be given the required financial assistance,? the Union finance minister announced, with a beaming Mamata by his side. Mamata?s body language suggested she was happy with the outcome of the meeting. The chief minister also invited Mukherjee to the state secretariat. ?I have requested Pranabda to come to Writers?. We will offer him tea and Pranabda will treat us to sweets,? she said, probably hinting at the bounty she was expecting from the Centre.Bengal has an outstanding liability of over Rs 2 lakh crore. After holding her second cabinet meeting last Wednesday, the chief minister had announced she would meet Mukherjee to seek the Centre?s help in finding a solution. Finance minister Amit Mitra, industries minister Partha Chatterjee, chief secretary Samar Ghosh, finance secretary C.M. Bachchawat and Union expenditure secretary ? tipped to be the next finance secretary ? Sumit Basu attended the meeting at Mukherjee?s Dhakuria home. ?A financial disaster had happened in Bengal, which was bigger than the Aila (cyclone),? Mamata said. ?Since November, treasuries are closed. Because of an unofficial embargo on expenditure, the development measures had come to a halt. We could not operate under such embargoes and lifted them,? she added, blaming the Left government for the fiscal mess.Aware that lifting the embargo alone will not be enough, the chief minister is leaving no stone unturned to generate the resources she will need to fulfil her promises ? from job creation to development projects. Three rounds of meetings will be held before the funds from the Centre can start flowing ? state government officials will meet Union finance ministry officials, after which Mitra will call on Mukherjee and finally Mamata and Mukherjee will meet again. No time frame was announced but the urgency was visible as Mitra rushed to Writers? Buildings after the meeting and went into a huddle with the finance secretary, probably to prepare the first set of documents the state would present to place its demand for a package. Asked later about the ?package?? Bengal had sought from the Centre, Mukherjee told
The Telegraph a ?preliminary discussion? was held with the chief minister and the Centre would consider it favourably. According to a source, Amit Mitra made a detailed presentation of the current financial health of the state.Sources said the talks revolved around the need for an increase in the state?s plan outlay and the possibility of converting high-interest short-term loans to longer term ones. ?The demand for releasing coal royalty at revised rates, which can fetch up to Rs 5,000 crore, also came up during the meeting. As per the discussion, we will have to discuss with the Planning Commission to demand a higher plan outlay. Pranab babu may talk to (deputy chairman) Montek Singh Ahluwalia about this,? a source said. The Centre, on Prime Minister Manmohan Singh?s initiative, has been working on a package for ?debt-stressed?? states like Punjab, Bengal and Kerala.High interest payment is one of the biggest problems facing the Bengal economy. In 2010-11, the state government paid around Rs 7,811 crore as interest to the Centre and around Rs 6,792 crore to other institutions. It is learnt that the state has requested Mukherjee to see whether a moratorium can be granted on interest payments. The state is also lobbying with the Centre to convert part of the interest-bearing loans taken against small savings into grants.?A lot of options were discussed during the meeting today. The officials will look into the viability of these options before the Union finance minister and the chief minister decide on the final outcome,? a source said.
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