West Bengal FY27 Budget a decisive shift towards investment-led growth: Report

An SBI Research report reveals that West Bengal’s FY27 budget marks a strategic shift toward investment-led growth and industrialization. While aiming to cut its revenue deficit, the state faces fiscal challenges from high debt and reliance on central funds

New Delhi: As the Bharatiya Janata Party (BJP)-ruled government in West Bengal presented the full Budget for the financial year 2026-27, thematic analysis points to a decisive shift in the Budget towards investment-led growth and economic transformation, an SBI Research report said on Thursday.

Themes relating to investment, governance, fiscal management, technology, entrepreneurship, tourism and climate resilience (that were hitherto absent in earlier budgets in terms of focus) assume greater prominence suggesting a strategic reorientation of the budget discourse towards industrialisation, productive capacity creation, and long-term growth acceleration, according to the report.

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West Bengal’s fiscal position has not been healthy with higher debt accumulation, despite higher share of Central Government grants.

In a persistent trend, grants from the Centre and tax devolution to West Bengal over the years has always been more than 50 per cent of overall tax revenue of the state.

“This has happened owing to rising unconditional cash transfers, higher off-balance sheet borrowings and higher committed expenditure and higher leakages in terms ‘middleman intermediation’ siphoning of monetary resources,” said Dr Soumya Kanti Ghosh, Group Chief Economic Adviser, State Bank of India.

West Bengal has significant potential of higher non tax revenue that has been languishing over the years and enhancing general administrative efficiency remains key to increasing non-tax revenues, Ghosh mentioned.

West Bengal is seventh largest in terms of coal-bed methene. The state can become the hub of methanol production given the locational advantage in CBM and coal gasification, the report noted.

“As part of a future endeavour, there is a need to operationalisation of an Eastern Multimodal Growth Corridor linking Bihar, Odisha, West Bengal and Assam, by integrating existing rail, road, port and inland-waterway assets,” it mentioned.

As per the Budget estimates for 2026-27, the revenue deficit is projected at Rs 21,984.41 crore, which is 1.02 per cent of the Gross State Domestic Product (GSDP), as against Rs 41,164.05 crore as per the revised estimates for the previous financial year of 2025-26.