NITI Aayog Vice Chairman Ashok Lahiri urges banks to act as investment matchmakers to boost industrial growth, strengthen MSMEs and unlock West Bengal's economic potential.
Kolkata: Banks must move beyond their traditional role of providing credit and actively facilitate investment to unlock the economic potential of West Bengal and eastern India, said Dr Ashok Lahiri, Vice Chairman of NITI Aayog, at the 19th Banking Colloquium organised by the Confederation of Indian Industry (CII) in Kolkata on Friday. Emphasising the need to strengthen the relationship between banking, investment and industrial development, he called upon banks to act as ‘matchmakers’ by connecting businesses with suitable financial resources and investment opportunities.
The colloquium, themed ‘Banking Beyond Credit: Powering Eastern India’s Industrial Growth’, brought together policymakers, bankers, regulators and industry leaders to discuss ways to improve capital flow, expand industrial activity and strengthen the micro, small and medium enterprises (MSME) ecosystem.
Dr Lahiri pointed out that banking serves purposes beyond lending, including providing a safe place for people to deposit their savings. Banks also invest in instruments such as government bonds to manage liquidity risks. According to him, India’s credit-to-deposit (CD) ratio currently stands at around 80%, compared with approximately 360% in China. He noted that the relatively limited availability of bank deposits could be one of the reasons behind lower credit flow to the private sector.
Highlighting regional disparities, Dr Lahiri said that the CD ratio in 2023 stood at 93.6% in southern India and 82.8% in the western region. In comparison, the eastern region recorded just 47.5%, while the figures for northern, central and north-eastern India stood at 77.5%, 56.1% and 50%, respectively.
Explaining the relatively low CD ratio in eastern India, he pointed to the limited availability of bankable investment opportunities and productive economic activities. West Bengal’s share of the national population is higher than its share of national income, while its per capita income remains below the national average. Limited industrial modernisation has also affected productivity and the state’s capacity to absorb credit, he observed.
Dr Lahiri stressed that West Bengal needs to strengthen its investment-driven economy through large infrastructure projects, industrial expansion and modernisation. Projects such as a deep-sea port could generate new investment opportunities and send a positive signal to potential investors. At the same time, encouraging the growth of both large industries and MSMEs would increase demand for institutional credit and create employment opportunities.
He further underlined the potential of banks to connect entrepreneurs with investors and appropriate sources of finance. By leveraging their extensive business networks and understanding of industry, banks can help identify viable projects and facilitate investment. Structured credit facilities and capacity-building programmes could also enable smaller enterprises to expand into larger businesses, generating a multiplier effect across the economy.
Rudra Chatterjee, Deputy Chairman of CII Eastern Region, Managing Director of Luxmi Group and Chairman of Obeetee, emphasised the importance of strengthening the MSME ecosystem and helping smaller businesses scale up.
Prithish Chowdhary, Vice Chairman of the CII West Bengal State Council and Deputy Managing Director of Titagarh Rail Systems Ltd, said that West Bengal must recognise and realise its economic potential to attract greater investment. Pointing to the state’s association with major banking institutions, including SBI, Bandhan Bank and UCO Bank, he highlighted the need to convert the state's existing strengths into viable, bankable projects.
Citing Reserve Bank of India data, Chowdhary noted that scheduled commercial bank credit in western India stood at ₹61.89 lakh crore, compared with ₹13.61 lakh crore in eastern India. He questioned why a relatively smaller share of capital was being channelled into investment in West Bengal despite its substantial savings base and significant presence of registered MSMEs.
C. S. Ghosh, Chairman of the CII Eastern Region Banking Colloquium and Chairman of Bandhan Group, said that the banking system must become a more active facilitator of economic growth. Despite global uncertainties, including geopolitical tensions, pressure on the dollar and fluctuations in oil prices, India's economy has continued to demonstrate resilience.
He also highlighted eastern India's strengths in natural resources, industrial corridors, educational institutions, connectivity infrastructure, renewable energy and manufacturing. According to him, stronger integration with domestic and global supply chains, supported by effective deployment of technology and capital, would be crucial to translating these advantages into industrial growth.
Bijay Murmuria, Chairman of the CII Eastern Region Financial Services Subcommittee and Director of Sumedha Fiscal Services Ltd, said eastern India had considerable advantages in connectivity, human capital and emerging business opportunities. The priority, he noted, should be to convert these strengths into enterprise development and employment generation by improving the flow of capital into the region.
Samir Agarwal, Co-Chairman of the CII Eastern Region Financial Services Subcommittee and Director of Indcap Advisors Pvt Ltd, also emphasised the need for banking to go beyond conventional lending and play a more proactive role in enabling investment and economic development.
The 19th CII Banking Colloquium witnessed participation from more than 300 delegates. Discussions focused on improving capital flows, strengthening MSMEs, promoting industrial expansion and unlocking the economic potential of eastern India. A key takeaway was that banks could play a transformative role in the region's development by connecting capital with viable investment opportunities and helping businesses grow.
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| L-R: Ms Akanksha Chaturvedi, Chairperson, CII ER NextGen Subcommittee and Executive Director & Chief Growth Officer, Gainwell Commosales Pvt Ltd; Mr Rudra Chatterjee, Deputy Chairman, CII Eastern Region and Managing Director, Luxmi Group & Chairman, Obeetee; Dr Ashok Lahiri, Vice Chairman, NITI Aayog; and Mr CS Ghosh, Chairman, CII ER Banking Colloquium and Chairman, Bandhan Group. |
Kolkata: Banks must move beyond their traditional role of providing credit and actively facilitate investment to unlock the economic potential of West Bengal and eastern India, said Dr Ashok Lahiri, Vice Chairman of NITI Aayog, at the 19th Banking Colloquium organised by the Confederation of Indian Industry (CII) in Kolkata on Friday. Emphasising the need to strengthen the relationship between banking, investment and industrial development, he called upon banks to act as ‘matchmakers’ by connecting businesses with suitable financial resources and investment opportunities.
The colloquium, themed ‘Banking Beyond Credit: Powering Eastern India’s Industrial Growth’, brought together policymakers, bankers, regulators and industry leaders to discuss ways to improve capital flow, expand industrial activity and strengthen the micro, small and medium enterprises (MSME) ecosystem.
Dr Lahiri pointed out that banking serves purposes beyond lending, including providing a safe place for people to deposit their savings. Banks also invest in instruments such as government bonds to manage liquidity risks. According to him, India’s credit-to-deposit (CD) ratio currently stands at around 80%, compared with approximately 360% in China. He noted that the relatively limited availability of bank deposits could be one of the reasons behind lower credit flow to the private sector.
Highlighting regional disparities, Dr Lahiri said that the CD ratio in 2023 stood at 93.6% in southern India and 82.8% in the western region. In comparison, the eastern region recorded just 47.5%, while the figures for northern, central and north-eastern India stood at 77.5%, 56.1% and 50%, respectively.
Explaining the relatively low CD ratio in eastern India, he pointed to the limited availability of bankable investment opportunities and productive economic activities. West Bengal’s share of the national population is higher than its share of national income, while its per capita income remains below the national average. Limited industrial modernisation has also affected productivity and the state’s capacity to absorb credit, he observed.
Dr Lahiri stressed that West Bengal needs to strengthen its investment-driven economy through large infrastructure projects, industrial expansion and modernisation. Projects such as a deep-sea port could generate new investment opportunities and send a positive signal to potential investors. At the same time, encouraging the growth of both large industries and MSMEs would increase demand for institutional credit and create employment opportunities.
He further underlined the potential of banks to connect entrepreneurs with investors and appropriate sources of finance. By leveraging their extensive business networks and understanding of industry, banks can help identify viable projects and facilitate investment. Structured credit facilities and capacity-building programmes could also enable smaller enterprises to expand into larger businesses, generating a multiplier effect across the economy.
Rudra Chatterjee, Deputy Chairman of CII Eastern Region, Managing Director of Luxmi Group and Chairman of Obeetee, emphasised the importance of strengthening the MSME ecosystem and helping smaller businesses scale up.
Prithish Chowdhary, Vice Chairman of the CII West Bengal State Council and Deputy Managing Director of Titagarh Rail Systems Ltd, said that West Bengal must recognise and realise its economic potential to attract greater investment. Pointing to the state’s association with major banking institutions, including SBI, Bandhan Bank and UCO Bank, he highlighted the need to convert the state's existing strengths into viable, bankable projects.
Citing Reserve Bank of India data, Chowdhary noted that scheduled commercial bank credit in western India stood at ₹61.89 lakh crore, compared with ₹13.61 lakh crore in eastern India. He questioned why a relatively smaller share of capital was being channelled into investment in West Bengal despite its substantial savings base and significant presence of registered MSMEs.
C. S. Ghosh, Chairman of the CII Eastern Region Banking Colloquium and Chairman of Bandhan Group, said that the banking system must become a more active facilitator of economic growth. Despite global uncertainties, including geopolitical tensions, pressure on the dollar and fluctuations in oil prices, India's economy has continued to demonstrate resilience.
He also highlighted eastern India's strengths in natural resources, industrial corridors, educational institutions, connectivity infrastructure, renewable energy and manufacturing. According to him, stronger integration with domestic and global supply chains, supported by effective deployment of technology and capital, would be crucial to translating these advantages into industrial growth.
Bijay Murmuria, Chairman of the CII Eastern Region Financial Services Subcommittee and Director of Sumedha Fiscal Services Ltd, said eastern India had considerable advantages in connectivity, human capital and emerging business opportunities. The priority, he noted, should be to convert these strengths into enterprise development and employment generation by improving the flow of capital into the region.
Samir Agarwal, Co-Chairman of the CII Eastern Region Financial Services Subcommittee and Director of Indcap Advisors Pvt Ltd, also emphasised the need for banking to go beyond conventional lending and play a more proactive role in enabling investment and economic development.
The 19th CII Banking Colloquium witnessed participation from more than 300 delegates. Discussions focused on improving capital flows, strengthening MSMEs, promoting industrial expansion and unlocking the economic potential of eastern India. A key takeaway was that banks could play a transformative role in the region's development by connecting capital with viable investment opportunities and helping businesses grow.
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