:: Issue Analysis Bihar’s political reform and its impact on the rest of India Santosh Kumar Business Analyst of POSCO Research Institutes, Delhi office ihar, the poorest state of India, has finally turned around both economically and politically and is seen as the biggest achievement of India. On the one hand, it achieved an B unprecedented growth rate of 11.35% (only second to Gujarat at 11.05%) in past five years and, on the other, it also broke out of the shackles of caste-ridden politics and overwhelmingly voted for developmental politics in the Assembly election in November 2010 under the leadership of National Democratic Alliance (NDA) Chief Minister (CM), Nitish Kumar. Bihar’s turnaround has now made Bihar a role model of vikas ki rajneeti (development-led politics) and sushasan (good governance) for the rest of India. There is popular perception that if Bihar, India’s most laggard state, can change, no one can stop India from becoming a world economic superpower. 123 Summer 2011�POSRI Chindia Quarterly Bihar Fact File Total Area 94,163㎢ Population 83 millions (3rd largest) Youth Population 58% (largest in India) Literacy 47% (2001) No. of Districts (Towns) 38 (130) Capital City Patna Urbanization 10.5% Road Length 82,959 kms Railway Length 5,400 kms Airports Patna & Gaya Economy Bases Service & agriculture Minerals Limestone, mica, gold Language Hindi, Urdu & English Religion Hindus (83%) Local Assembly 243 seats National Parliament 40 seats Political Parties JD(U), BJP, RJD Political Leaders Nitish, Modi, Laloo New Political Agenda Development with justice ○● Laloo’s Bihar (1990-2005) Bihar’s Vaishali, a place near Patna, gave the first republic to the world in 600 B.C and was one of the most powerful provinces of India throughout the Indian history. However, especially during the 15 years of caste-ridden political governance of Laloo-Rabri (1990-2005), Bihar lost mainstream development and became India’s poorest state when the rest of India joined the mainstream development. Its economy deteriorated, infrastructures crumbled, industries closed, inter-caste violence increased, crime syndicates flourished, scams increased, unemployment multiplied and administration turned anarchic. Millions of Biharis migrated to cities like Delhi, Mumbai, Kolkata, Chennai, Bangalore etc. in search of jobs. According to the World Bank, 124 POSRI Chindia Quarterly�Summer 2011 :: Issue Analysis Bihar experienced from zero to 3.5% growth rates There is popular perception that if in the 1990s. Separation of Bihar, India’s most laggard state, mineral-rich Jharkhand can change, no one can stop India from becoming a world economic from Bihar in 2000 further superpower. deteriorated the condition of Bihar’s economy. Bihar and Biharis began to be identified with the buffoonish speaking accent of Laloo. Bihar and Biharis became a subject of ridicule outside Bihar. Laloo-Rabri’s 15-year rule is notorious for kushasan (bad governance), contrary to Nitish’s sushasan. The only achievement of Laloo-Rabri is that they awakened the aspirations of the backward castes for power-sharing in the high caste-dominated society and politics of Bihar. But merely awakening their aspirations without making any provisions of economic security further tore apart the social fabric of Bihar and resulted into loot and anarchy. This was the social and economic mess and political jungle-raj (law of the jungle) that Nitish Kumar inherited from his predecessors, Laloo and Rabri, when he became Bihar’s CM in 2005. ○● Nitish’s Bihar (since 2005) In 2005 Bihar Assembly election, Janata Dal(United) or JD(U) and BJP won the majority of seats and JD(U) leader Nitish Kumar took over as the CM of Bihar and BJP leader Sushil Kumar Modi took over as deputy CM in November 2005. Nitish and Sushil, both long time friends since the JP Movement of the 1970s had a very herculean task to administer economically devastated and socially disturbed Bihar. Nitish government’s first job was to establish the rule of law and order in society. Since 2005, Nitish government has convicted more than 40,000 criminals and has neutralized crimes to a great extent in Bihar. Nitish and his team adopted development with justice as his political agenda, which was welcomed by all sections of the society. 125 Summer 2011�POSRI Chindia Quarterly He framed policies for industries, agriculture, and administration. Building infrastructure, especially roads and bridges, was his priority. Bihar started turning around, and the results of growth started showing in terms of improved law and order situation, newly built roads, rural electrification, improved standard of administration, etc. Between 2004-05 and 2008-09, Bihar witnessed a compound annual growth rate (CAGR) of 11.35%, making Bihar the second fastest growing state after Gujarat. Three sectors witnessed exponentially high growth rates—construction (36%), communications (18%), trade, hotel and restaurants (18%). The fact that Bihar, once a no-go area for foreign tourists, attracted more foreign tourists than Goa in 2009 proves that not only the law and order has drastically improved in Bihar but also the transportation facility has also improved. Nitish government’s janta-darbar (public hearing) to resolve complaints of aam admi (common people) draw him many followers from the weaker sections. Women empowerment through various social schemes drew him huge support from women. He gave 50% reservation to women in the village level panchayat elections. He incentivized girls’ education through free distribution of school uniforms and bicycles. Further, his zero tolerance against corruption earned him an image of a clean man unlike Laloo and Rabri. In the past five years, Nitish has successfully changed the casteist mindset of the Yearly Growth Rate (%) of Bihar GSDP at 1999-00 Prices 25 22 20 16.59 15 11.82 12.17 10 8.04 5 1.49 0 2001-02 2002-03 2004-04 2004-05 2005-06 2006-07 2007-08 2008-09 -5 -4.73 -5.15 (Nitish Govt) -10 Source: Bihar Economic Survey (2009-10) 126 POSRI Chindia Quarterly�Summer 2011 :: Issue Analysis Laloo-Rabri’s Bihar towards development-oriented Bihar. Consequently, people of Bihar voted him back to power in 2010 for the next five years. Today Bihar is a socially, politically, and economically reformed state of India though there is still much to be done. Its journey has at least begun. ○● Leadership factor Bihar’s turnaround success is mainly attributed to the visionary leadership of Nitish and his deputy Sushil Kumar Modi. Nitish adopted the reforms recommended by the Administrative Reform Commission (ARC). Nitish called upon the talented people to come forward with innovative suggestions to make Bihar a progressive state. Nitish made a team of skilled bureaucrats and professionals to frame vision and policies for the development of Bihar. Nitish government ably handled the rehabilitation of nearly 2.3 million people of northern Bihar affected by Koshi river flood in 2008. Though the flood was a tragedy, it turned out to be an opportunity for Nitish to show how efficient leader he actually is. Nitish flood relief handling was nationally and internationally appreciated. Further, Nitish’s zero tolerance against corruption is a sign of strong leadership. Beyond Right to Information Act, 2005, Nitish government is making Right to Service Act for the first time in India to make bureaucrats fully accountable. He thinks that merely getting information under RTI, 2005 is not enough; rendering of service on time is essential. Narendra Modi of Gujarat, Naveen Patnaik of Orissa and Nitish of Bihar do developmental politics, but Nitish is different from Modi as he is a benign and moderate leader unlike Modi. Nitish is also different from Patnaik as he does not have a family legacy unlike Patnaik. Experts can attribute Bihar’s turnaround to a number of internal and external factors, but the single most factor of Bihar’s turnaround is Nitish’s dedicated leadership. Nitish’s work has been nationally and internationally appreciated by bodies 127 Summer 2011�POSRI Chindia Quarterly like the Planning Commission of India and the World Bank. Nitish was also selected as Indian of the Year in 2010 by CNN-IBN. ○● Promotion of industry Before Nitish, there was no industrial policy as such in Bihar. He made Industrial Incentive Policy, 2006 to offer incentives such as stamp duty exemption on lease/sale of land for industry, 80% VAT reimbursements for ten years, 50% reimbursement on capital investment in power plant and machinery, etc. Bihar Single Window Clearance Act, 2006 was made to grant faster approvals. Nitish has appealed to industrialists to invest in Bihar. Though Bihar could not attract big industries in past five years but it did attract a number of small and medium industries. As many as 245 proposals were approved by State Investment Promotion Board (SIPB) by 2009 for INR 133.84 crores. Food processing, power plant and steel processing are major investment areas. Recently, Nitish has appreciated the pace at which China is making progress. He is also looking for some big-brand industries to come to Bihar. ○● Unprecedented victory Bihar has 243 seats in the Bihar Assembly. In Bihar Assembly election (2005), the JD(U)-BJP won 143 out of 243 seats but in Assembly election (2010), JD(U)-BJP won 206 out of 243. Party Performance in Bihar Assembly Elections (2005 & 2010) This is the biggest election victory of Parties 2005 2010 any political combination in India. This JD(U) 88 115 victory has decimated Laloo and NDA BJP 55 91 Congress completely. There is no RJD 54 22 political party qualified to become an LJP 10 03 Congress 09 04 opposition party in the Bihar Assembly. Others 27 08 Nitish can be rightly credited with this Total 243 243 victory, but there are certain socio- 128 POSRI Chindia Quarterly�Summer 2011 :: Issue Analysis political equations that worked in his favor.