Taking part in on its strengths, the state ought to give attention to strategic reforms in three specific sectors, specifically Information technology, dairy and food processing and agriculture.
Options for the IT sector
The IT trade is the biggest contributor to the full exports of the nation and has performed a transformative position within the financial improvement of a few of Indian states. Karnataka, Telangana and Haryana are India’s largest IT hubs and contribute a cumulative 17 per cent to India’s GDP (8%, 5% and 4% respectively). On condition that the educated youth is shifting out of Bihar in massive numbers and is basically employed within the IT sector, Bihar has a possibility to develop this sector and retain its expertise.
There are a complete of 358 SEZs in India, concentrated primarily within the states of Telangana (56), Karnataka (52), Maharashtra (45) and Haryana (20). At current, there is no such thing as a operational SEZ in Bihar. The Bihar authorities ought to develop IT infrastructure parks comprising industrial and residential complexes. Partnering with non-public industrial actual property gamers, seeking to make investments on this sector, could be a attainable choice.
Secondly, the federal government ought to give attention to resolving infrastructure points associated to land acquisition at average land costs and enhance street connectivity.
Presently, land acquisition in Bihar is complicated and acquisition value is excessive as many of the land is agrarian with fragmented possession. Improvement of a land financial institution by the federal government might ease the land acquisition course of.
Thirdly, coverage reforms akin to declaration of IT as a vital service; exemptions from statutory energy cuts; and institution of 1 cease regulatory clearance to help traders all through the funding life cycle spanning from utility to approval of licenses, will go a good distance.
Options for dairy and meals processing sector
The quantum of dairy manufacturing and agri produce in Bihar could be very important. It has the tenth largest dairy market in India, with 10.4 billion litres of milk procured in 2019. It’s the third largest producer of potato; largest producer of okra; second largest producer of cabbage in India; largest producer of litchi; third largest producer of pineapple and fourth largest producer of mango in India.
Regardless of this, an insufficient infrastructure for meals processing has been an enormous hurdle within the progress of this trade. Bihar has solely 5 chilly storage models towards Punjab’s 20, AP’s 15 and TN’s 11.
Bihar ought to goal to duplicate the mannequin constructed by Amul in Gujarat whereby it reworked the dairy sector. Gujarat now has 17 cooperative dairy unions, 25 non-public dairy vegetation and over 15,000 major milk cooperative societies.
It ought to set up satisfactory chilly storage and processing models for major fruits/ greens akin to mango and litchi, and grain processing models for wheat and maize close to farm places. Processing models for litchi in Muzaffarpur and Samastipur districts, for mango in Madhubani, Muzaffarpur and Darbhanga, and for makhana in Darbhanga will be best selections. A sturdy public-private partnership will be explored to realize this.
As we speak, native industries avail of meals testing and certification providers from Kolkata, Hyderabad or Bengaluru. The federal government must arrange meals security requirements and testing services throughout the state.
Suggestion for the agriculture sector
Bihar has a excessive proportion of agriculture in land and labour drive. As a lot as 74% of the inhabitants is employed in agriculture v/s nationwide common of 60%. Additionally, 55% of the state land is used for agriculture. It’s predominantly a foodgrain rising state with ~80% of its gross cultivation space mapped for rice, wheat and maize.
The principle challenge is lack of agricultural warehousing and the processing capability. Solely 8-10% of maize is processed throughout the state, regardless of the rising marketable surplus. The put in capability of rice milling is inadequate to fulfill the present demand, regardless of rice having 45% share in food-grains. With the brand new agriculture coverage of the central authorities, it’s attainable to draw non-public sector participation in contract farming, warehousing and transportation.
Establishing of huge scale maize processing models within the districts like Khagaria, Madhepura and Begusarai; and rice processing unit in excessive productiveness district of Rohtas may very well be explored.
The state also needs to give attention to agri-financing and personal/ on-line mandis to enhance value realisation for farmers. Incubation and promotion of tech-enabled options (full stack answer for farmer inputs and advertising necessities) to help farmers with end-to-end options starting from procuring agri-inputs to connecting with institutional financiers and patrons, could be helpful.
Additionally, give attention to agri-supply chain startups that present reasonably priced warehousing options to farmers would assist bridge the shortfall in agriculture storage.
We consider these measures can play a transformative position within the inclusive financial progress of Bihar.
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