Addressing the inaugural session of the West Bengal State Planning Board on "Decentralisation: devolution and participation", Sen said information flow from the local bodies to the Centre was necessary to make the planning process effective and functional.

Democracy was the only suitable system for decentralisation, Sen said. He added that several east European states had also realised the need for proper flow of information from the grassroots to the apex level.

Citing an example in this context, Sen said China could have averted the worst famine ever during 1958 in which 39 million people were killed if the central planners had been made aware that food supplies at the local levels were actually in surplus and not in deficit.

Besides information, Sen also cited autonomy and motivation as other measures for successful implementationof the decentralisation process.Inaugurating the 3-day conference, chief minister Jyoti Basu said the state government was working out the best option for decentralisation. He added that the state had met with partial success especially in the areas of land reforms and panchayat administration.

Governor of Reserve Bank of India, Bimal Jalan said transfer of financial authority was absolutely necessary for effective decentralisation. According to him, it was negligible in almost all states. Jalan expressed concern at the growing revenue deficits of almost all the states from 1987-88 onwards. In some states, he pointed out, interest payments exceed the allocation for education. He warned that the issue of revenue deficit could not be ignored any more and if left unattended would create problems for the states concerned.

Jalan said he was unable to figure out why the credit-deposit ratio in West Bengal was low. He said a possible way of remedying the situation was to ensure micro credit.