The secret of India’s most liveable megacity

JAMES WILSON arrived in Calcutta, then the capital of British India, in 1859. The founder of The Economist had been “expressly sent from England to restore order in the finances of India at a period of disastrous confusion”. He delivered the country’s first budget, introduced a system of income tax and then promptly dropped dead from, as his epitaph puts it, “the combined effects of climate anxiety and labour”.

Since Wilson’s time, the city has lost its capital status (to Delhi, in 1911), half its Bengali hinterland (to partition, in 1947) and its English name (to linguistic decolonisation, in 2001). What it has gained is a claim to be the most liveable megacity in India. Rents and home prices are the lowest among India’s biggest cities. So are fees for good schools and health care. A rich tradition of art, music and literature supports its self-proclaimed status as the country’s cultural capital, and it is liberal on matters of religion and gender relations. With nearly 23m people, it is India’s second-largest metropolis, after Delhi.

Residents are served by public transport that is cheap, varied and expanding. A network of elevated roads has emerged, connecting far-flung bits of the city. The streets below are crowded with commerce and chaos, but things are still a long way from Bangalore’s gold-standard gridlock. A rash of cafés is being joined by trendy cocktail bars and upmarket restaurants. Towering new hotels and fancy flats are adding a touch of Mumbai-style glamour to the skyline, while grand old mansions are being renovated to serve as Airbnbs.

Much of the city’s improvement is attributable to Mamata Banerjee, who as chief minister has led West Bengal, the state of which Kolkata is the capital, since 2011. Run by communists for the previous 34 years, it had become notorious for labour unrest and hostility to business. Ms Banerjee modernised the city and rolled out welfare schemes for minorities, women and the poor. The mix of low prices and handouts has made Kolkata the best big Indian city in which to be poor or middle-class.

But it is less hospitable to those with greater ambitions. Under Ms Banerjee West Bengal’s share of national output has continued to slide. There are few white-collar jobs. Talented young Bengalis leave in droves. Graduates from the rest of India rarely move there. Population growth is the slowest of India’s five biggest cities. That Kolkata no longer offers direct flights to London is particularly hurtful to its Anglophile elites.

Ms Banerjee has no vision for the economy, complains one grandee. Her government does not disincentivise business, but nor does it compete with states that lay out the red carpet for investors. In recent years more than half of all foreign direct investment flowed to Maharashtra and Karnataka, homes to Mumbai and Bangalore. West Bengal attracted less than 1%. “You cannot just give and not earn much,” says a local economist.

If Kolkata still appears to be thriving, that is because of its default status as the commercial capital of India’s vast and deprived eastern region. It is a historical trade hub, the gateway to the remote north-east and a magnet for migrants from neighbouring Bihar and Jharkhand, two of India’s poorest states. The post-pandemic rise of working from home has attracted a trickle of white-collar returnees. Consultancies and IT-services firms are beefing up their subsidiary offices. But judged by its potential, Kolkata is a chronic underachiever. That is a tragedy not just for the city and its state, but also for the surrounding region.

This month Ms Banerjee will ask Bengalis to give her a fourth term. State elections in India are rarely predictable, and the outcome this time is all the more uncertain after voter-roll revisions struck 9m names, nearly 12%, off the electorate. Voters face a difficult choice. Narendra Modi’s Bharatiya Janata Party promises to prioritise development, but will also fracture the state’s religious tolerance with its divisive Hindu-nationalist agenda. Ms Banerjee offers more of the same: Bengali pride, handouts and a personality-driven politics that puts even Mr Modi’s in the shade.

If Wilson returned to Kolkata today, he too would find it surprisingly liveable (literally, in his case). But he might look to Mumbai, Delhi and Bangalore, collapsing as they are under the weight of people, pollution and construction, and conclude that their problems are symptoms of rapid growth. Kolkata’s pleasantness, on the other hand, is a sign of its stagnation. ■