New medical, engineering and MBA colleges planned in Bihar

The Bihar government emphasizing focus on education has decided to start 19 superspeciality medical colleges, 23 engineering colleges and a couple of management institutes in the next five years.

Dy. CM, Sushil Modi in an interview to Economic Times not only mentioned the above but also said that their focus would be to build the IT industry in Bihar (Patna) and make it an important IT destination after Bangalore. He has said that the government is finalizing the IT policy and is in talks with IT companies to setup offices in Bihar. With the finalized IT policy, incentives would be given to IT companies starting operations in Bihar.

I think both the above actions are good moves in the right direction as lesser people will now go to other states and invest in those states for higher education. At the same time after graduation, students will have more job opportunities to work in the hitech industry without leaving Bihar.

I hope whichever party comes to power in the forthcoming assembly elections follows through with the above plan.

The interview of Mr. Modi can be read in Economic Times at Bihar can be the next top IT location: Deputy CM Modi

Vaishali to be developed as an international tourist center

Bihar government has realized that developing tourism is very important for the faster growth of Bihar.

In this series the government has decided to develop Vaishali as an international tourist center. This is a good news as even though Vaishali is famous all over Bihar, hardly anyone outside knows about it.

Good move.

The news article can be read at Vaishali to be developed as 'international tourist attraction'

Why is Bihar poor?

Many states have talked about step motherly treatment from the central government and this is often a political statement. However the statistics from Bihar and the disparities are hard to ignore when it comes to the question of step motherly treatment towards Bihar by the central government.

1. Road Density: State’s road density (per head of population) is the lowest and is about 40% of the national average.
2. Railways: Bihar has boasted of many Railway Ministers but the rail route density is also the lowest (if we ignore Kerala and the hill states).
3.  Power generation capacity: Bihar has less than 1% of the country’s power generation capacity. This is the condition of the state which had a high level of coal and other mineral deposits not long ago. Even power plants sanctioned by the state government / central government are not coming up because
1. Bihar not being given coal linkages by the central government
2. Bihar asked not to use water from the river Ganga for power generation
4. Power consumption: Per capita power consumption is 12 percent of the national average.
5. Revenue resources: Very limited. Just 10% of Haryana’s per capita
6. 5 year plan outlays: Bihar’s per capita plan outlay has been the lowest among all states in most plan periods. Some of it was offcourse Bihar’s fault (example Lalu’s era) but even in Nitish Kumar’s period, Bihar continues to be under-invested for development even though Nitish has been asking for funds from long
7. Freight equalization policy: This policy of the past half century has neutralized whatever locational advantage Bihar had for attracting natural resources based industry. And then the special tax benefits to better-off states have indirectly compounded the damage.
8. Bank loans: Since industry is bare minimum in Bihar, most of the money that banks collect as deposits in Bihar is being loaned out in other states.

Most of the above can be attributed to the Central government. But lets leave the past and concentrate on the present and the future.

Today the state has an atmosphere which is conducive to investments. Then why are the Central Government and the Planning Commission hesitant to invest in Bihar? Isn’t Bihar a part of India? Doesn’t Bihar deserve to grow when it has helped other states to prosper either by giving natural resources or by giving the labor workforce? By one estimate the Punjab farms and the farmers are only thriving because of Laborers from Bihar. If the laborers stop going there, the farm industry there will collapse as Punjab doesn’t retain most of its youth who move out to greener pastures in India and abroad).

Isn’t it time for the Prime Minister – Chairman of the Planning Commission, the Dy. Chairman of the planning commission – Mr. Montek Singh Ahluwalia and the Central Government to overcome political compulsions and support the cause of Bihar. Till when can they ignore the 3rd most populous and the poorest state of India (the highest number of poor people live in Bihar).

Its time for everyone to ask our Prime Minister and Mr. Montek Singh Ahluwalia – When will you start thinking for Bihar and its people???

The above statistics are taken from the article T N Ninan: Why Bihar is poor published in the Business Standard and authored by Mr. T. N. Ninan

Nitish Kumar's speech at the ET Business Reformer of the Year 2009 award ceremony

Hi friends,
I liked this speech of Mr. Nitish Kumar at the Economic times forum and sharing it with everyone. This speech has been posted on youtube and we are able to watch it courtsey Mr. Shatrughna1.

Bihar - A Growth Story - TOI - Mumbai Edition

Absolutely Happy to read this full page article in The Times of India - Mumbai Edition on the 10th of January 2010. Similar articles in different editions of TOI.

Here is the article and for those who want the PDF version of the page , the same can be found at Bihar - A growth story

BIHAR, A GROWTH STORY

From Basketcase To Booming Economy, Bihar Is On The Mend. Sunday Times Makes A Ground Check
Raj Kumar TNN


Roads “as smooth as Hema Malini’s cheeks” was a promise that Lalu Yadav had once given to the people of Bihar. Ironically, it is his rival Nitish Kumar who seems to be delivering on that front. Despite three years of floods followed by a year of drought, ‘backward and benighted’ Bihar reports a miraculous figure: 11% GDP growth, second only to Gujarat. The state’s economy has never grown so fast so consistently as it has since 2004-2005. A few pointers on what’s going right in Bihar:

Getting anywhere in Bihar has always been an exercise in endurance. But that’s changing. More than 6,800 km of roads have been relaid and 1,600 bridges and culverts constructed in the last four years. Journey time in India’s 12th largest state, sprawling over 94,163 sq km, has been cut by half today in many places. Now, most of the state’s 38 districts — from northernmost West Champaran to Kaimur on the western end — are a drive of six hours or less from Patna.

Automobile sales in the state grew 45% in 2009, at a time when sales had dipped 20-25% in several other states during the economic slowdown. Is this buying spree an indication that a section of Biharis have more money to splurge than they did earlier? “A few people had money earlier too, but they didn’t flaunt it for fear of attracting extortionists and kidnappers,” says Ranjit Singh, director of a highend Patna hotel. That fear may have evaporated now.
Only 317 kidnappings for ransom were reported during the last four years as against 1,393 during the previous four. The kidnapping industry has clearly fallen on hard times. One indication of this is that doctors no longer refuse to go to patients’ homes on emergency calls. “Today you can see boards at clinics saying we go on calls,” says Dr Amulya Kumar Singh, who runs a nursing home in Patna.

Most of Bihar’s infamous dons are behind bars. That includes Mohd Shahabuddin, the former RJD MP who had once gone live on TV, daring the state police chief to arrest him. Things are a little different now. A ruling JD(U) MLA, Sunil Pandey, attempted an encore of sorts in early 2006 when he brandished a revolver and talked murder on TV. But Pandey found himself behind bars within no time. Speedy trials have ensured a total of 38,824 convictions between 2006 and September 2009.The convicts included dons and their henchmen.

Gun-toting strongmen are no longer a common sight on the streets of Bihar. Policemen patrol them now. And places like Siwan, where Shahabuddin once held sway, do not get deserted after dusk.

This improvement has shown results. Malls, shops and private educational institutions are coming up. So are mobile service providers and banking firms. It’s boom time for real estate with apartment buildings coming up all around. “That’s because even non-Biharis for a change want to have a foot in Bihar which has become a better place to live in,” says economist Shaibal Gupta of the Asian Development Research Institute. Adds Faizal Alam of Kalyanpur Cements, “Cement inflow to the state went up 18% to 51 lakh tonnes in 2008-09.” That’s an indicator of the construction boom.

Ironically, this economic growth has happened without any worthwhile contribution from the manufacturing sector. The state’s economy is growing because of a boom in agriculture and services sectors. “It’s government induced growth,” admits Bihar Industries Association (BIA) president S P Sinha. According to former BIA president K P S Keshri, private investments in the manufacturing sector have been as little as Rs 1,500 crore during the last four years.

Many attribute the growth to the fact that the flow of Central funds to states has increased manifold in recent years. In the case of Bihar, it went up from Rs 37,341 crore during the fiveyear period 2000-2005 to Rs 55,459 crore during the next three years. But equally importantly, the funds are now getting better utilized than during the Lalu-Rabri regime when large chunks remained unspent. Also, adds Gupta, the state made concerted efforts to mobilise internal resources with its own revenue collection going up from Rs 2,919 crore in 2003-04 to Rs 5,256 crore in 2008-09.

The flip side is that much of this growth does not get reflected in social indicators which remain abysmal. But, as Gupta says, it would be unrealistic for anyone to “expect the moon” at this stage. “Right now the fundamentals are getting corrected and therefore you can find mostly infrastructural indicators of growth; one will have to wait for social indicators to become visible,” he says.

While contractors and realtors stand to gain, more than half the state’s 8.2 crore people — 1.25 crore families — still live below the poverty line. For these families to prosper, Bihar desperately needs huge investments and more growth. The State Investment Promotion Board, formed by the Nitish government, has received proposals worth Rs 96,000 crore. But most of them, especially the major ones, remain on paper as Central rules prove a stumbling block. For instance, thermal power plants cannot come up in Bihar because the Centre has so far refused to provide coal linkages to ensure regular supplies to any such new plant.

Also, Bihar has a lot of catching up to do with the rest of India. “There cannot be any comparison between Gujarat and Bihar, both of which reportedly grew by over 11%; since our base is low, even a small investment results in impressive growth in percentage,” Gupta points out. State officials admit that crucial sectors like health are still sick with meagre resources in comparison to other states.

From its bleak past, Bihar may be finally moving towards a brighter future, but the common Bihari is not patting himself just yet. Maybe he is still waiting for this high growth to translate into better food on his table and more money in his pocket.

BUT MILES TO GO

POVERTY 54.4% of the population is below the poverty line; national average 37.2%

HEALTH 32.8% children fully immunized; all-India 43.5% 55.9% children underweight; national average 42.5% 45.1% women underweight, highest in the country; national average 35.6%

AGRICULTURE 81% of the population employed in agriculture, directly or indirectly 2.7% Annual growth in agricultural GDP (1993-2003); all-India growth 2.2%

ROADS 70% of the inhabited areas in Bihar are not connected by motorable roads, which is the highest in the country

INDUSTRY 3.2% Share of industry in economy; all-India 20.1%

POPULATION 82.9m Bihar’s population, growing at more than 2% per annum (2001 census) 90% of the population lives in rural areas

LAND HOLDINGS 0.75 hectare Average size of holdings; national average 1.41 hectares 82.9% Share of marginal holdings less than 1 hectare

FLOODS 68.80 lakh hectares Total flood- prone area in Bihar, which is 73.06% of its total area and 7.2% of the total flood-prone area in the country

Source: Report of Special Task Force on Bihar, 2008

Bihar Growth Statistics and Image Management - Article by Mr. T. V. Sinha

This is an extremely well written email from Mr. T. V. Sinha that has highlighted the changes that have come in Bihar. I am sharing this email with everyone so that not only members of some yahoogroups but also everyone who ever thinks of Bihar and does an online search should know that Bihar is changing.... and that it is changing for Good.

Anyone who wants the email id of Mr. T. V. Sinha can write to me and I will share the email id.

--------------------------------------------------


On Thu, Jan 7, 2010 at 3:31 AM, TV Sinha wrote:


Bihar is at the cusp of a major change. Or as Ajit Chauhan puts it, it is at the tipping point. We have all seen the reports of CSO giving the high growth rate of Bihar. Unsurprisingly, there has been an equally vehement outcry against these positive news articles. If these were constructive criticism, one would have learnt something from them, but unfortunately, much of this outcry is simple denigration. In such a scenario, we Biharis are duty bound to work together and present the true picture of Bihar. Image makeover is essential if Bihar has to catch up with the rest of the country or indeed the world. Last five years have shown some hints of growth. The next five years are crucial whether Bihar will be on road to progress and growth or will slip back to underdevelopment and ignominy.

I have tried to collect recent criticism of Bihar and put the rebuttal to those. Hope this helps counter the continued denigration of Bihar

Agriculture growth of Bihar has languished:

It is certainly not a fact that Bihar is at the bottom of growth in the farm sector. Indeed, today Bihar is self sufficient in food, which was not so earlier. Farm sector has grown at 5.6% per annum over a five year period and is a great achievement.

It can be a matter of research how this growth in farm sector could have been even higher if there was a major irrigation investment, which has not happened in Bihar. Farmers have innovated and achieved growth. Some of these are private investment in farm automation, improved seeds and fertilizer and training of the farm hands due to their exposure to farming in Punjab, Haryana etc where the agricultural universities have played in farm hand training. Also, thanks to better availability of information, price realization for the farmer is much better which incentivizes higher farm productivity.

If Agricultural growth is only 5.6%, how has a largely agrarian Bihar economy grown at 11.03%:

Well, the growth in 2004-9 and 1999-2004 sector wise is as follows:

Agriculture: 5.6% from 2%; Manufacturing: 8% from -1.9%; Construction 35.8% from 8.4%; Telecom 17.7% from 9.4% and Trade, Hotel, Restaurant: 17.7% from 11.6%

Indeed, the growth has come from largely from what is called services sector at an aggregate level. But there is no reason to doubt the growth figure itself.

Here are some more specific statistics: Consumption of cement in Bihar has grown 27% vs the India average of 9%, no of flights from Patna has increased as follows: from 2 to 5 to Delhi, from 2 to 5 to Calcutta, From 2 to zero to 2 to Mumbai, from zero to 1 to Hyderabad and Bangalore each. Gaya had virtually no regular flights five years back. Today, it has 25 international flights a week to Bangkok, Colombo, Paro, and Singapore. The number of bridges constructed between 1975 and 2005 was 300 and is over 400 between 2005 and now â€" Nitish Kumar inaugurated 140 bridges on June 14, 2009 in a symbolic gesture; the number of vehicles in Patna has increased from 1.75 lakhs in 2007 to 2.93 lakhs in 2009, a 67% increase in just two years.

Bihar growth is on a low base. Specifically, can a poor student who had scored a low 30 who has now scored 45 be considered successful when a good student has moved from 80 to 85

Economic growth is always taken on the existing base. China has been considered a miracle economy for two decades now, but can hope to catch up with US only by 2035. Economies can only grow gradually, not suddenly. The case of Bihar is like any other growing economy. Also, bear in mind that in spite of the low base, the economy was not growing fast earlier. In 2005, after the hung assembly which could not produce a government, Bihar bashing journalists, inspired by the MV Kamath who had infamously said that Biharis are not fit to rule Bihar and require extended outside tutelage, had grandly suggested President's Rule. The conventional wisdom had suggested that we can only get a government worse than that of Lalu. Bihar can only go down. Is there any reason we should not celebrate the success which has been achieved in such a hopeless environment?

Data is given by Bihar and not by CSO.

Well this is the same for all the states and has been the same in the past also. This system has not changed this year. For example, the growth of Gujarat is also based on the figure given by the Gujarat govt. Also, I find it quite funny that Pronab Sen of CSO should so disown the data released by his own department. They are not a clerical staff tasked to aggregate the data, but Cnetral Statistical Deptt who have all the tools and expertise available to cross verify the data with other trends as also sample survey that they do.

The number of BPL family has increased from 66 lakhs to 1.25 crore:

Bihar govt says the original figure of 66 lakhs was an underreporting. They quote the figure of 1.25 crore to get more funds for the BPL families. This has absolutely no relevance or relation with the economic growth or the lack of it.

Simple fact is that annual plan expenditure for Bihar has increased from 2500 crore in 2004-05 to 1200 crore in the current fiscal year. This has naturally led to growth of the economy. Also, fruits of liberalization such as disbanding of freight equalization has finally started to yield. That perhaps is also the reason for Jharkhand's growth.

Besides all these, the focus of the state govt on law and order and the commonsense schemes of the govt like strenghtening PHCs, road improvement ot make Patna accessible within 5 hours from any part of Bihar etc have played a major role in the growth.

Finally, in addition to the great philosophical tradition of Bihar, trade and commerce have had a long history, broken only in the dark sixty years of Delhi iimposed fabian socialism. The tome of Chanakya is called Arthashashtra - the treatise of money. Sonepur has had the largest cattle fair of the world since time immemorial. The most exploitative Nawabs of Bengal could not diminish the mercantile importance of Patna during the 18th century. Andrew Yang, an academic from US did a research and wrote the book Bazzar India which chronicles this. Time has come to reclaim the leadership in the economic sphere and the whole world will be at the feet of Bihar.

Let us see the glass as half full rather than rue that it continues to be half empty. Not too long time back, it is fully empty!

Let me end by giving a link to India Today which also printed an article on Patna titled P for Progress

http://indiatoday.intoday.in/site/Story/76746/India/State+Scan+-+Patna:+P+For+Progress.html

Thanks

T V Sinha

Livemint article (Signs of renewal in Bihar) and my take on it.

Signs of renewal in Bihar

From: Prashant
Date: Wed, Jan 6, 2010 at 2:32 PM
Subject: Signs of renewal in Bihar
To: views@livemint.com

Interesting article and well summarized as far as the status of the state is concerned over the last so many years. However I think its not just the change in guard from Lalu to Nitish that is responsible for the double digit growth in GDP or the changes that have come up in the state but the focused efforts made towards improving the health of the state.

Some of the changes that have come in, in the last years are

1. Improved governance leading to improved security. Number of incidents of crime and kidnapping have reduced. More criminals including MPs have been convicted and are serving life sentences.The vehicular population in Patna for example has more than quadrupled in the last 4 years. This has not happened in Bihar during the entire economic boom in India after 1991 until 2005. And many vehicles now ply on the road after 7 PM which was not the case some years ago.
2. Educational infrastructure is being improved. More primary education centers are being implemented and existing failing infrastructures are being reconstructed. More than 2 Lakh teachers have been appointed.
3. Healthcare has seen significant improvement. From a mere 4000 baby deliveries happening in the PHCs , the number has gone upto 80,000 because healthcare has improved, doctors are present and medicines available.
4. Infrastructure improvement is taking place. There are better roads and better connectivity.
5. Tourism is picking up: The number of foreign tourists visiting Bihar has gone up by 5 times in the last 4 years.
6. Investment projects are getting clearances and proposals worth more than 75,000 crores have been approved even though the work on them are in the initial phases.

Obviously there are many inherent problems like casteism and corruption in Bihar that cannot be eliminated in a 5 year period. But the government is building the foundation of education that will lead to the reduction of these kinds of inherent problems.

There is still a lot to be done. In my personal belief the work done in Bihar in the last 4 years is not yet become self sustainable. This will only happen when enough interest has been generated in the state wherein

1. Significant investments are made into the state
2. More job opportunities are created for the people of the state
3. Media provides enough coverage and acts as a check and balance in the state. Example : carrying out sting operations on bureaucrats, etc can create the atmosphere for people to avoid carrying out their corrupt practices.Or for example, media uses its reach to educate people on the positive as well as negative changes happening in the state.
4. Various political parties do not just play mere political games when it comes to the question of the development of the state.

This is where your role as media comes up. Obviously you do not have enough coverage of the state and therefore are not possible aware of some of these changes that are happening. However your help can improve the state by highlighting the investment opportunities in the state as your paper is read by many people who control investment decisions in their companies.
I had a similar thinking like yours until a year back when I started tracking the changes in the state and was at first as surprised as you and questioned the fact that were these things really happening. Now I know that if the government continues doing the same kind of work that its been doing in the last 4 years for the next 5-10 years, Bihar will become one of the most developed economy in India. You might want to read about Nitish Kumar's plan 2015 or the progress reports that are released every year by the government. I track these changes and you might be able to get more information on these changes, if you so desire from my blog http://progressivebihar.blogspot.com/

You may want to begin with the reports on the right hand side of my blog.

Appreciate your patience in reading through this entire email.

Thanks
Prashant


----------------------------------------------------
http://www.livemint.com/2010/01/03184644/Signsof-renewal-in-Bihar.html?atype=tp

Signs of renewal in Bihar

Bihar is often seen as India’s Somalia: a failed state run by a venal political elite, a civil society fractured by caste, a dysfunctional bureaucracy that does not police the streets or ensure that teachers attend school and an economic sinkhole bypassed by the economic boom that has transformed the country. Biharis have voted with their feet, and their mass migration has led to a backlash in cities as diverse as Mumbai, Guwahati and Ludhiana. Bihar is too big and strategically important to be allowed to wallow in backwardness. The new numbers published by the Central statistics office offer hope of renewal: They show that the state’s output from 2004-05 to 2008-09 grew at a double-digit annual rate, outperforming India as a whole. It is yet not clear what has propelled Bihar’s growth in these years, but one clear possibility is the change of government in the state: from Lalu Prasad to Nitish Kumar. No economy can grow when the rule of the law has collapsed and deep institutional decline raises the cost of economic activity, constant features on the Bihar landscape since at least the end of the 1980s. The larger lesson is that the politics of redistribution inevitably becomes a grab for resources unless robust economic growth keeps the cake growing. That is the tragic dividend of Mandalism. It is hard to believe that Bihar was rated India’s second best governed state after Independence by the Paul Appleby report. The late journalist and political thinker Arvind Das saw Bihar as a metaphor for India. He often pointed out that this is the state of Gautam Buddha and King Ashoka, of Rajendra Prasad and Jayaprakash Narayan. It’s now the state of anarchy. It is too soon to conclude that Bihar has healed and is ready to participate in the modern Indian economy as an equal partner rather than as a laggard that sucks public funds and sends millions of impoverished immigrants to other states. There is always the danger of reading too much into random bits of statistics; the same mistake was made with West Bengal a few years ago, which grew at around 1 percentage point faster than the national average for around 10 years but really does not offer enough economic opportunity to its residents compared with what states such as Gujarat, Tamil Nadu or Karnataka do. It is hard to believe that a mere change in the state government can uproot deep-rooted problems within five years. But there is definitely reason to believe that the Nitish Kumar government has done enough to undo some of the worst features of the Lalu Prasad years.Is Bihar on the path to recovery? Tell us at views@livemint.com

11.03% - Bihar's GDP growth rate between 2004-05 and 2008-09

The nation today will wake up to the reality that Bihar has been the second fastest growing economy in India in the last 5 years. At 11.03% GDP growth rate, Bihar is only marginally behind Gujarat whose GDP grew by 11.05%. This is surely going to make heads turn across India. Who would have thought that a state which had 5.15% negative GDP growth in 2003-04 and had been consitently declining in all sectors and all aspects, could change so much in so little a time.

This is another proof that good governance and a will to change things can do wonders. Kudos to Mr. Nitish Kumar and his team for doing something which many would have thought impossible or even a miracle to achieve in Bihar.

Everyone has heard the hype associated with the Gujarat growth story over the last few years, but Mr. Nitish Kumar and his team have again slowly and steadily brought about a change and shown the way of progress, which has become a hallmark of Mr. Nitish Kumar. Obviously it would have been more difficult to change a state like Bihar compared to Gujarat which was already prospering.

I am really happy that many people today will sit up and take notice of the change that has come to Bihar and will start appreciating the Bihari people more than they did before.

The detailed news can be found in the Times of India article "Bihar grew by 11.03%, next only to Gujarat"

Happy New Year 2010

Dear Friends,
Wish you all a Very Happy and Prosperous New Year. Have a wonderful year and may you achieve all your goals for this year.

Lets also hope that Bihar too has a great and prosperous new year.

Regards
Prashant