Rate-cut drama attracted political wrath for BJP in view of the ongoing Assembly polls in the state
West Bengal, which is in the midst of a high-pitched electoral battle, has topped the list with Rs 90,000-crore collection from small savings schemes. The Bengal polls had on Thursday driven the BJP-led central government in the eye of a storm after it rolled back the move to cut interest rates on these schemes within hours.
The overnight drama over the ‘oversight’ was seen by BJP’s political rivals as a knee-jerk reaction because of the ongoing elections in Bengal and Assam and the upcoming polls in Tamil Nadu and Kerala.
On the small savings investment list, Bengal is followed by Uttar Pradesh with a gross collection of Rs 69,660.70 crore, out of the Rs 5.96 lakh crore garnered in 2017-18 (last updated), as per data collated by the National Savings Institute under the finance ministry. Maharashtra has come third with a collection of Rs 63,025.59 crore and Gujarat came fourth with Rs 48,645.28 crore. The gross collection only accounts for inflow, and not redemption. It includes collections of small savings in post offices as well as banks.
The government had late on Wednesday proposed a steep 1.1 per cent cut in interest rates in small savings schemes like Public Provident Fund (PPF) and National Savings Certificate (NSC). On Thursday morning, the finance minister tweeted that it was an “oversight” and restored the existing rates. Bengal went into the second phase of Assembly elections on Thursday.
“The rate of interest on various small savings schemes for the first quarter of 2021-22 starting from April 1 and ending on June 30, 2021 would remain unchanged from those notified for the fourth quarter (January 1 to March 31, 2021) of 2020-21,” says a finance ministry office memorandum in suppression of its previous order.
According to the National Savings Institute, which works under the Department of Economic Affairs of the finance ministry, Bengal has been a leader in collections for the small savings schemes and the collection hovered around 12-15 per cent in the last few years.