Context:
This article debates whether Bihar’s geographical disadvantage of being a landlocked State is responsible for its persistent economic underdevelopment. Experts R. Nagaraj and Manindra Nath Thakur discuss structural, economic, and political reasons hindering Bihar’s growth.
Key Highlights / Thematic Discussion
- Geography and Landlockedness
- Bihar is landlocked, lacking direct access to seaports.
- R. Nagaraj argues: Geography is not a decisive barrier—States like Punjab and Telangana are also landlocked but have progressed due to education, infrastructure, and industrial strategy.
- M.N. Thakur: Geography poses logistical challenges, especially for perishable agrarian exports (makhana, litchi, corn). High transport cost and time delays hurt competitiveness.
- Agriculture vs. Industrialisation
- Bihar is an agrarian economy with 80% workforce in agriculture but low productivity.
- RN suggests focusing on comparative advantage – strengthen agriculture first before moving to manufacturing.
- MT cautions against replicating Punjab’s Green Revolution model due to risks of water depletion, fertiliser use, and ecological damage.
- Both agree: Industrialisation is essential for Bihar’s future but must be gradual and well-planned.
- Historical Policy Disadvantages
- Freight equalisation policy (post-independence era) harmed Bihar’s industrialisation by making raw materials available across India at uniform cost, reducing Bihar’s locational advantage.
- Bihar remained a supplier of labour and raw materials without value addition.
- Structural and Governance Challenges
- Problems rooted in frozen transition from feudalism to capitalism.
- Weak state capacity, poor investment climate, and bureaucratic inefficiency.
- Outmigration driven by lack of employment; however, investments in agriculture earlier reduced migration, showing potential.
- Political Economy and Social Issues
- Debate on socialist legacy of Bihar:
- RN: Focus shifted to resource distribution (caste politics) rather than productive investment.
- MT: Bihar never built strong capitalism nor sustained socialism—caught in a policy vacuum.
- Lack of Bihari identity or economic vision weakens collective progress (Bihari asmita question raised).
- Demand for Special Category Status
- RN: Special status alone won’t help due to low state capacity to utilise funds.
- MT: Special assistance may help only if corruption and elite capture are controlled.
Relevant Prelims Points
- Freight Equalisation Policy (1952–1992) – Led to regional industrial imbalance.
- Green Revolution – Initially focused on Northwest India.
- Comparative Advantage – Economic concept by David Ricardo.
- Special Category Status – Based on Gadgil Formula, discontinued by Finance Commission post-2014.
Relevant Mains Points
- Causes of regional disparity in India.
- Role of governance, policy history, and institutions in economic development.
- Migration and labour economics.
- Need for structural reforms in backward states.