West Bengal must create ecosystem where startups flourish

With many top-tier educational institutions, good telecom and power connectivity, and the availability of numerous quality plug-and-play infrastructure facilities, West Bengal has all the basic ingredients for a startup ecosystem to take stronger roots in the state

The newly-elected West Bengal government must make the establishment of a vibrant startup ecosystem one of its top-most priorities as it aims to revive the entrepreneurial culture in the state, create more, and better-quality jobs, and stem the migration of many of its brightest to other regions in search of employment.

With many top-tier educational institutions such as the Indian Institute of Technology, Kharagpur, the Indian Institute of Management, Calcutta, Jadavpur University, etc., good telecom and power connectivity, and the availability of numerous quality plug-and-play infrastructure facilities, especially in Kolkata, the state has all the basic ingredients for a startup ecosystem to take stronger roots in the state.

To support startups, the state should strengthen the existing Startup Bengal initiative by empowering it with adequate funding and facilitating partnerships with leading venture funds, family offices, and globally leading academic institutions so that more young entrepreneurs gain access to mentorship and seed funding. Special incentives can be designed for startups that come up with workable solutions for addressing challenges faced by the state’s legacy industries, like tea and jute, and micro, small and medium enterprises (MSMEs), which dominate West Bengal’s industrial landscape.

Startup Bengal has remained largely ceremonial, with no clear data available in the public domain on what it has achieved. As per the Union Ministry of Commerce and Industry, West Bengal has 7,458 DPIIT-recognised startups compared to 39,591 in Maharashtra, 23,092 in Karnataka, 19,888 in Gujarat, and 15,173 in Tamil Nadu.

In line with the broader objectives of attracting capital flows and creating employment opportunities, an ‘Invest West Bengal’ organisation, chaired by the chief minister, should be set up for attracting investments by merging existing organisations like the West Bengal Industrial Development Corporation (WBIDC), Webel, etc., to speed up administration decision-making and fast-track the process of granting approvals. The existing structure for attracting investments is not working is already evident in the state’s continuing slide as an economic hotspot.

West Bengal should accord serious consideration towards the establishment of a dedicated Department for Artificial Intelligence tasked with the responsibility of improving the AI-readiness of the administration as well as that of MSMEs. A rise in AI-readiness could significantly increase the state’s ability to provide better citizen-centric services and raise the global competitiveness of its MSMEs.

A lesson in this connection could be drawn from neighbouring Odisha, and from the United Kingdom’s Office for Artificial Intelligence.

Last year, Odisha approved the Odisha AI Policy 2025, which seeks to integrate AI across key sectors, develop an AI-skilled workforce, and enable responsible, inclusive AI innovation at scale.

A dedicated task force, comprising representatives from government, industry, academia, and civil society, can be formed to come up with ways through which these proposals may be implemented with institutional discipline and long-term consistency. This committee should be asked to submit an interim roadmap within 30 days and a detailed implementation framework within 90 days so that the process of a phased rollout could start within the first six months of the government’s tenure.

West Bengal will have to compete for attracting investments with other states, including Odisha and Assam, which have in recent years taken giant strides to improve their investment climate and strengthen co-ordination with the Union government. Assam has emerged as a destination for semiconductor investment led by the Tata Group, which aligns with the national goal of having a self-sufficient semiconductor ecosystem.

In the current volatile global environment, attracting large greenfield investments is a tough ask for any state, especially for West Bengal, where acquiring large tracts of land for industrial use continues to be a challenge. The memory of the land acquisition-related protest at Singur that led to the exit of the Tata Group’s small car plant from West Bengal is still fresh in the minds of corporate India.

Prospective investors are no longer simply interested in the schemes on offer by states, including the subsidies provided. Importantly, they are also looking at which state offers the best ecosystem for long-term growth. For West Bengal, which must contend with a perception issue also, opting for the same strategy as others to attract private capital may not prove very effective.

Sumali Moitra is a current affairs commentator. Views are personal. X: @sumalimoitra.

(Disclaimer: The views expressed above are the author's own. They do not necessarily reflect the views of DH)