For decades, West Bengal’s economic trajectory has been narrated as one of decline — a once-industrial powerhouse that lost its edge and never recovered. While not entirely wrong, this narrative is incomplete. A closer look at the evidence suggests a more nuanced reality: Not a collapse, but a structural imbalance — one where rural gains have quietly sustained living standards even as urban dynamism has faltered.

Our joint research with Dilip Mookherjee shows that once we adjust for differences in inflation across states, West Bengal’s per capita net state domestic product (NSDP) has grown roughly in line with the national average over the long run. The apparent “decline” in West Bengal’s NSDP per capita relative to the rest of India, in nominal terms, is largely driven by lower inflation.

This shifts the question from West Bengal’s “decline” to the “divergence” of its growth path relative to the rest of the country. Part of the answer comes from consumption patterns. In real terms, West Bengal’s average consumption levels have broadly tracked the national average. But beneath this aggregate stability, lies a sharp rural-urban divide, especially if we pay attention to the nominal-real divergence. Even as nominal rural consumption in West Bengal has fallen behind the rest of India, real rural consumption has actually improved, especially in recent years. The experience of urban West Bengal stands in contrast — it was ahead of rest of India in nominal value of consumption (even if marginally) until 2017, after which rest of India surpassed urban West Bengal. What played in favour of rural West Bengal, worked against its........

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