Aug 26, 2012

The economic strangulation of Bihar

You can read here how Bihar is denied even its rightful share of central resources. Even in agriculture which is still happening in Bihar, NABARD is investing minimal compared to other states. You see lots of central govt. institution is outside Bihar. What those central govt institution is doing there. Developing light combat aircraft in 25 years and then also somehow it can fly. This is not just an enough example. 
  • As opposed to an All-India per capita developmental expenditure (from 2000 to 2002) of Rs 6748.50, Bihar's is less than half at Rs 3,206.00.
  • But Bihar is being systematically denied, let alone the additional assistance its economic and social condition deserves, but also what is its rightful due. From the pitiful per capita investment in Bihar, it is obvious that the Central Government has been systematically starving Bihar of funds.
  • That politics has a lot to do with neglect is seen from the fact that while AP received Rs 3,507.60 crore (1998 to 2000) as "additional Central assistance for externally-aided projects in State Plans," Bihar received just Rs 306.90 crore.Even in terms of grants from the Central Government (2000 to 2002), Bihar fares poorly. It received Rs 4,047.30 crore while AP topped the list with Rs 9,790.00 crore. Bihar has also been neglected as far as net loans from the Centre are concerned. It received just Rs 2,849.60 as against Rs 6,902.20 received by AP from 2000-02.
  • Similarly, Bihar received a pittance from the financial institutions, a mere Rs 551.60 per capita, as opposed to the national average of Rs 4,828.80 per capita. This could presumably be explained away by the fact that Bihar now witnesses hardly any industrial activity. But no excuses can be made for the low investment by NABARD.

    On a cumulative per capita basis (2000 to 2002) Bihar received just Rs 119.00 from NABARD as against Rs 164.80 by AP and Rs 306.30 by Punjab. It can be nobody's argument that there is no farming in Bihar.
The author is an independent think-tank.