The economy of Bihar: Bihar, whose capital is Patna, is located in India’s eastern region. On the north, it shares its border with Nepal. In the east, it shares its border with West Bengal. In the south, it shares its border with Jharkhand, and on the west, it is with Uttar Pradesh that it shares its boundary. We’ll have a detailed look into the Economy of Bihar and different aspects impacting the economy.
Economy of Bihar
Bihar has a strong economy as it has a singular location related advantage; since it is close to the vast markets of northern and eastern India. It has easy access to the various ports such as in Haldia and Kolkata, also has access to sources of raw material to mineral reserves available from the nearby states. Some of the critical industries in Bihar are dairy, leather, textiles, tobacco, chemicals, transport equipment, plastics, rubber, and food and beverages.
There has been high growth in Bihar’s per-capita net state domestic product. Bihar’s GSDP has increased from 1015-16 to 2019-20 at 13.2 per cent CAGR. Considering the current prices, the state’s per-capita NSDP has seen an increase of 13.41 per cent CAGR during the 2016 to 2021 period.
Amongst all states of India, Bihar ranks amongst the top strongest states agriculture-wise. As high as 80 per cent of the population of Bihar is seen to be employed in agricultural production, which is way more than India’s national average.
Bihar is the 8th largest fruit producer of India and the 4th largest vegetable producer. Some of Bihar’s fast-growing industries are healthcare, manufacturing, sugar, dairy, and food processing. For several of the other sectors, initiatives have been planned by the state for their development. Some of these sectors are tourism and education. The state is also making various incentives available for several sectors, such as the renewable energy sector and the information technology sector.
In Bihar, there is a vast base of industrial labour, which is highly cost-effective. This advantage makes Bihar perfect for many types of industries, such as labour-intensive industries.
Data from DPIIT shows that from October 2019 to March 2021, Bihar’s cumulative Foreign Direct Investment inflow was 50.62 million US$.
In 2020, Bihar’s total exported merchandise was millionUS$ 1,661.13. Between 2020 and January 2021, the exports were valued at US$ 1,160.72 million.
Recent Developments
- As of January 2021, through the Saat Nischay Part-2 programme, the department for road construction decided to have bypass roads constructed in 120 locations (urban) all over the state to reduce traffic congestion. A total of 708 kilometres of roads will be built at a cost of Rs 4,154 crores (estimated).
- In December 2020, Mr Nitin Gadkari (Union Minister for Road Transport and Highways) inaugurated Bihar’s Koilwar Bridge, a major transportation bridge from Bihar to UP vice-versa. It is a 1.5-kilometre-long three-lane bridge and has been erected at a cost of Rs. 266 crores.
- Road valued at a cost of Rs.30000 crores are under construction in Bihar. Acquisition compensation of land has been announced to the sum of Rs.4600 crores.
- Possibly, by 2023, Koshi bridge (4 lanes, 7- kilometres long) costing Rs. 1478 crores will be ready.
- SpiceJet announced that it would commence thirty new domestic flights, of which six would be from Darbhanga. These flights began in a phased way starting 20th December 2020.
- Mr Ravi Shankar Prasad (Minister for Communications, Electronics and Information Technology) said in 2020 October that within the following months, they would connect 46000 villages in Bihar via fibre optic.
- On 27th September 2020, a 660MW unit of the supercritical thermal power plant of Bihar was synchronised with the grid by NTPC Limited to enable electricity generation. NTPC set up five units, each with 660MW capacity, in Barh around 3200 acres.
- In the 2019-20 period, Gaya and Patna managed 3,606 and 30,959 aircraft movements. During this time, the no. of passengers they handled were:
- Patna 45,25,765
- Gaya 2,37,452.
During this time, the Patna airport managed 12,249 MT freight traffic.
Core Sectors
- In May 2021, the state Government of Bihar announced that it wishes to complete the wheat procurement based on the MSP by 31st May 2021. To procure around 100ppp metric tonne of wheat, the state government will start the procurement drive through Vyapar Mandals PACS.
- In March 2021, the Union Minister of State for Ports, Shipping and Waterways, announced that they would make an inland port on the banks of the river Gandak in the Saran district.
- In March 2021, the union aviation ministry announced that they would expand Darbhanga Airport in Bihar under UDAN Regional Connectivity Scheme.
- Under State Budget 2021-22, Rs. 5,803.60 crore have been allocated for road constructions in the rural and urban areas of Bihar.
- In March 2021, the state government of Bihar announced that it would provide an electricity connection to each agricultural land at lower rates by March 2022.
- In 2019-20, the total production of horticulture crops in the state was expected to be 20,676.37 thousand metric tonnes, and the area under production was 1,175.98 thousand hectares. In 2019-20, the total production of fruits and vegetables was estimated at thousand metric tonnes 4,256.21 and 16,327.53 thousand metric tonnes.
- Bihar’s sugarcane production (2018-19 (P)) was 182.85 lakh MT. Of the total cultivated land of Bihar, close to six per cent is under sugarcane. At the time of the 2019-20 season, Bihar had 11 sugar mills operating. In 2019-20, it was estimated that 220.50 lakh MT of sugar would be produced.
- In 2019, the arrival of foreign tourists was at 1.093 million, and the arrival of domestic tourists was at 33.99 million.
In this article, we have discussed the state’s economy, the reasons behind its rise and other concerning issues. We hope this article will be of help to you.
FAQs: Frequently Asked Questions:
Some of the sectors of the Bihar economy where the state government is providing incentives are information technology and renewable energies.
The percentage of Bihar’s population, which is still employed in agriculture, is eighty per cent.
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