Economists have argued that role of agriculture is pivotal for economic development of the nation. Worldwide studies have shown that agriculture sector is more effective in reducing hunger and poverty than other sectors. This study is an attempt to ascertain the importance of agriculture in the economic growth of West Bengal. Agriculture, being the source of livelihood and supplier of raw material to various industries, triggers economic growth of the nation. This paper exhibits how agriculture has contributed to West Bengal's economic excellence using empirical data and a cointegration analysis. The role of agriculture is examined on four contributions: (a) product contribution (forward linkage), (b) market contribution (backward linkage), (c) factor contribution, and (d) foreign exchange contribution. The composition and growth of the sectors and its association with other sectors is analyzed using time series analysis. Findings of the study revealed that agriculture sector has appeared as an important contributor to drive West Bengal economic growth even after declining share in gross state domestic product over the years. Empirical analysis reveals that agriculture is having long run causal linkages with industry, services, and overall economic growth in West Bengal.
This study has attempted to re-investigate the impact of fiscal deficit (FD) on current account deficit (CAD) (also known as twin deficit hypothesis) in India from 1970–1971 to 2018–2019 in the presence of private saving–investment gap (SI) and exchange rate (EXR). For the empirical investigation, the study has employed the nonlinear autoregressive distributed lag (NARDL) approach to cointegration. The NARDL results found the evidence of an asymmetric effect of FD, SI and EXR on CAD in the long run only. The obtained results support the traditional views of the Keynesian approach that FD has a positive impact on CAD, validates the existence of the ‘Twin Deficit Hypothesis’ in India. Further, results also depict that SI has a positive effect on CAD, whereas EXR has an adverse impact on CAD. From a policy standpoint, the asymmetric impact of FD on CAD provides strong reasons for conceiving policies that are adaptable to changing dynamics in internal as well as external sectors.
India is the second most populous country in the world and stood at seventh rank in a major climate risk index in 2019, which is a grave concern for the Indian government, policymakers and environmentalists. Therefore, the present study examines the role of fiscal policy and monetary policy instruments along with select macroeconomic variables on carbon emission in India over the period 1971–2019 in the non‐linear framework. The outcome of the study reveals that the impact of fiscal and monetary policy instruments on carbon emission is asymmetric in nature. In addition, the positive and negative shocks in fiscal and monetary policy instruments have a positive and negative impact on carbon emissions, respectively. Based on the coefficients’ magnitude, the role of fiscal policy instruments has a more prominent effect on carbon emissions than monetary policy instruments. The findings of the study imply that the Indian government is required to implement green fiscal and monetary policies. Use fiscal policy to implement a ‘green tax ratio’ and a ‘green subsidy programme’ for manufacturers and investors to reduce CO2 emissions. A ‘green lending programme’ should be introduced for commercial banks by implementing monetary policy via the central bank.
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