Study of economy of Bihar: Post bifurcation

Abstract

Bihar is 12th largest state (Area wise) and 3rd most populated state followed by U.P and Maharashtra.Earlier Bihar was categorized as BIMARU state along with some of its neighbors due to lack ofgovernance, widespread corruption, minimal growth in almost every sector and infrastructure. Biharwas lagging behind continuously from many states like Gujarat, Maharashtra, Kerala, Tamil Nadu etc. interms of industrial development, infrastructural facilities etc. Though there were many historical reasonstoo which contributed to the merciful condition of Bihar like Permanent Settlement Act, FreightEqualization Policy which laid the foundation of ill fate of the state decades ago. But even afterindependence condition of Bihar didn’t improve and it further deteriorated under caste based politicalsystem, corrupt leaders and bureaucrats and lack of commitment and accountability at top level ofstate. JP movement showed some promising results in the state but after its failure there was masscorruption rooted in each pillar of governance. Followed by these incidences, there was problem offloods which devastate the state almost every year, problem of Naxals who do not allowed whatsoeverdevelopment work was carried in state, problems of tribal who demanded separate state which naturalmineral laden, continuous 15 years of rule of Laloo (directly or indirectly) and many more. A renownedauthor even said Bihar has gone into Dark Ages and if India has to grow at double digit it cannot leaveBihar as it is now.Bihar was bifurcated in Nov 2000 and a separate state Jharkhand emerged out of it. Then in 2005 therewas political turnover and Nitish Kumar became CM of state throwing away 15 years RJD rule. Hestarted his journey on thorns and lot was expected from him. Within 5 years of his tenure, he has turnedthe face of earlier sick Bihar into a promising, civilized and astonished state. Bihar is growing at around11% per annum for last two years much ahead of all other states in country. He introduced manyeffective policies in almost all department starting from agriculture, education, health, industries togovernance, infrastructure etc. He formulated numerous effective policies and implemented themthoroughly. He has modified Bihar from no governance to good governance state. We can visualize theeffective role of good and eminent leader at the top and what a leader is capable of. The gross statedomestic product of state has raised from around Rs 60000 Crore to Rs 140000 crore, per capita NSDPhas rose to around Rs 13000, Around Rs 1065 Crore fund has been released under PMGSY (2008-09),proposed investment is RS 13674 Crore (2009-10), around Rs 25000 Crore is to be invested inmanufacturing and construction. These figures are mere indicators of growth the state has shown in last5 years.There are also few challenges in current state of Bihar. These all developments are attributed to goodgovernance and effective leader at the top. What will be its fate after Nitish Kumar’s rule? Will itcontinue to grow at same pace? Again slow growth in infrastructure, Less FDI, instilling trust amonginvestors, lesser Central grant are some of the key challenges that need to be addressed in future tomaintain sustainable growth of Bihar.