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Volume XLIV, No.49

Nitish’s Bihar Vision

Tuesday 24 April 2007, by Subodh Kumar


On November 24, 2006, Nitish Kumar is completing one year in office. The contemporary situation in Bihar demands economic participation along with social transformation and political participation. These demands are the result of the piecemeal “social engineering”. If we see Bihar in 2005-06 we find that Bihar is the only State in India’s electoral history where polls have been conducted twice in the same year.

In 1990 Laloo Prasad faced three types of demands within the society. The first demand was from the majority of the population, who were mainly engaged in agriculture but were landless. They were drawn primarily from the weaker sections and OBCs. Their expectations from Laloo were to quicken the pace of the transformation and bring Bihar out of medievalism. The second demand was from 14 per cent of the population who belonged to the twice-born caste. Their expectation was to participate in the process of economic development. The third demand was from the minorities who wanted to secure the right to life and liberty after the Bhagalpur riots.
Since the twice-born castes were not able reap the benefits after the reform of 1991, their expectation from Laloo was belied as he did not have any blue-print for economic development. The Muslims were satisfied since there had been no riots in Bihar during his rule, whereas economically developed States like Maharashtra and Gujarat witnessed the worst kind of riots ever. Moreover, the other backward castes increased their participation in strengthening the democratic structure of the State. This is an investment in the democratic process and the results of this effort have given a platform for the Nitish Government to strengthen the economic structure of the State.

The OBCs, Backward Classes and Muslims—who were politically conscious—got integrated into the democratic process, and now wanted to increase their participation on the economic front, but their hopes were shattered and this led to disillusionment. Hence, the strength of Laloo became his liability.

The results of the 14th Assembly elections in Bihar were a mandate for Nitish Kumar. The message from these elections was clear and unambiguous: Nitish, who has a pan-Indian strategy, must carry economic development parallel with social transformation since the most backwards and lower castes within the Muslims still need social upliftment so that they can also participate in the democratic investment process. This is the greatest challenge for Nitish, but if we analyse his one year of rule we find that Nitish’s contributions on both the social and economic fronts have been good.

Till recently, investment in Bihar was not a viable option for the market gurus. But the environment has changed; now the people are willing to lay their bets on Bihar. On the other hand, the government is also doing its bit to change the maligned image of the State. The Government of Bihar has spelt out new programmes to attract investment in a number of sectors. If investors want to invest in technical institutes, then 50 per cent of the land cost will be borne by the State and 50 per cent of the stamp duty will be waived on the registration of land. This would bring investment in medical, engineering and management institutes in the State.

The Government of Bihar has given a special package for the entertainment industry. It has amended the entertainment tax structure, lowering it from 110 per cent to 50 per cent. Moreover, the State Government has announced incentives for attracting investment in the sugar sector. In the field of infrastructure development, the State Government has taken an initiative to restructure the loss-making Bihar State Electricity Board. The State Cabinet has approved the proposal to split the BSEB into six separate companies, which involves creation of the Bihar State Electricity Company, Bihar State Production and Trans-mission Company, Patna Electricity Supply Company, North Bihar Production and Trans-mission Company and North-East Bihar Electrical Company.

On the other hand, the State Government has formulated own schemes along with the Central Government schemes to implement connectivity programmes. Along with the Pradhan Mantri Gram Sadak Yojana to connect all villages with a population of 1000 and more, a State level scheme has been worked out to connect villages with a population of 500 and more through the “Setu Nirman Yojna”. Moreover, the government has created a “Land Bank Yojna”, so that if viable projects come then the needed land can be released and projects take off. To reduce the fury of floods and drought and to enhance tourism the government has proposed to take up interlinking of rivers within Bihar. And to promote organic farming Agri Clinic Schemes are under way.

In order to remove the alienation of women from the decision-making process the State Government has carried out political decentralisa-tion. Panchayats now have 50 per cent reservation for women. But all these programmes cannot be implemented if the law and order problem prevails. Hence, government is working hard on giving complete freedom to the police to act without political interference.

Nitish’s problem of implementing these projects is very different from what other States face because population density of Bihar is the second highest in the country (880 per sq. km.). The literacy rate is approximately 47 per cent. What is more, there is absence of a market mechanism. Thus the push factors to leave Bihar are very strong. The problem of Naxalism has gradually engulfed the State. Rural poverty is the worst in Bihar—while the all-India average landless agricultural workers comes to 66.52 per cent, in Bihar it is 79.07 per cent. Only four per cent of the population control about 80 per cent of the total agricultural land. The proposed setting up of a Land Reform Commission by the present government would carry forward the objective of “socially comprehensive development”.

Along with the development of market mechanism the present government must realise that the heartland of the industrial revolution in the 1950s became mired in poverty and stagnation because of deplorable governments and weak institutions. This can only be overcome through education. As Alexis de Tocqueville ascribed the success of democratic institutions in the USA to the abundant opportunities for education, Bihar’s decay can be located in the decline of its once-vibrant academic life. If steps are not taken in this direction speedly enough, then a State that John Houlton described as being “the heart of India” will die unsung.


1. The Economic Times, July 20, 2006.
2. India Development Report, 2001.

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