The Hindu Business Line : Why is Bihar a failed State?

A FEW years ago a senior advocate during a Supreme Court hearing, casually remarked that a particular government should not suffer from the `Bihar Syndrome'. It created a furore with several parties, organisations and people, including legislators from Bihar, expressing outrage.

Right or wrong, in the public eye Bihar has come to symbolise a land of "no opportunity" or one of "unequal opportunity", a `failed State' where poverty and extreme inequality abound. Those who eulogise Bihar's past seem to forget that doing so does little to correct its negative image and nothing at all to change the stark reality. At the same time, it may be worthwhile examining the factors that account for the disconnect between Bihar's glorious past and its appalling present.

In 2005, a survey of 20 big States by a news magazine ranked Bihar 20th in primary health, primary education, infrastructure, investment, budget and prosperity; 19th in the `economically most free' category, 17th in literacy, 14th in water sanitation and 12th in agriculture.

Its demographic indicators present a gloomy picture too. Bihar tops the decadal rate of increase in population (1991-2000) with 28.4 per cent against the national average of 21.3 per cent. Similarly, the density of population per sq km in Bihar is double the national average. Its sex ratio of 921 per thousand is less than the national average of 933 (as per the 2001 Census). More than half (52.5 per cent) the population is illiterate. The infant mortality rate is high at 62 per thousand. Its economic indices as well as socio-economic indicators are not too impressive either.

So, when and how did Bihar's precipitous decline begin? To put things in perspective, it may be useful to take the time of Independence as the base line. Soon after Independence, during the 1950s, Bihar's administration was assessed as the best in the country by the renowned intellectual, Paul Appleby. Krishna Sinha was the State's first Chief Minister and L. P. Singh, the Chief Secretary.

They had a vision for the future, a passion for hard work, a mission for public welfare and a habit of impartiality and fair play. However, under pressure from landlords in the ruling party, not much was done to implement radical land reforms.

This period saw the establishment of good academic institutions and big industrial projects such as the Bokaro Steel Plant, Heavy Engineering Corporation (HEC) at Ranchi, and a petroleum refinery and a fertiliser unit at Barauni.

The term `rural reconstruction', coined by Mahatma Gandhi, was the buzzword of the government and administration in the 1950s and the 1960s. The buildings, roads and other infrastructure built at that time were of high quality. Drawn from the rank and file of freedom fighters, the political leadership in the districts too was mature and visionary.

The year 1967 was significant in the political history of Bihar. It saw the coming to power of the non-Congress government — ending a long held monopoly. However, the State government was transformed into a `softer state'. Instead of improving the quality of educational institutions in the public sector, many were privatised. Several politicians set up schools and colleges, often in their own names, but did not bother about providing satisfactory infrastructure, teaching aids and training teachers.

Teachers started working full-time for party-politics and only part-time for the educational institutions. The quality of teaching quickly deteriorated. Mass copying became the order of the day in the 1970s.

Furthermore, the evaluation of answer scripts was no longer a fair game, with teachers working under the influence of bribes or recommendations. In brief, the education system — the rock bed of a fair society — became steeped in corruption.

A Parliamentary system based on rule through majority votes has reinforced caste divisions in the State. Caste and vote-bank politics is resorted to by most parties.

Further, along with the `criminalisation of politics' there was `politicisation of crime'. The upshot: A disconnect between the voter and his elected representative. It is easy for the latter to lose sight of `real' issues — flood, irrigation, education, health, industrialisation, rural development, drinking water, sanitation, and electrification — that affect the former every day.

During the last decade, Members of Parliament and State Legislators were given the power to sanction development projects up to Rs 2 crore in their constituencies annually. In an already corrupt system this boosted the culture of `kickbacks' with about two-thirds of such projects remaining incomplete.

Attempts to invigorate democracy from the grassroots have also been largely unsuccessful.

After the 73rd Amendment to the Constitution in 1992, the States were obliged to hold panchayat elections. Yet, these elections were not held till 2001. When they were finally conducted, many with criminal record were elected. As a result, regular meetings of the panchayat were not held, fake signatures were put on official papers, schemes were selected at the whims of such elements. Many roads and drains were built only on paper. It would not be wrong to conclude that the panchayat system in Bihar is dysfunctional. Actually, it has led to the emergence of a `neo-feudalism' at the village, block, and district levels.

The absence a Green Revolution seems to be among the reasons for the economic backwardness of Bihar. Institutions of and investments in agricultural research are minimal. Even in the manufacturing sector, the absence of a mature capital market, information asymmetries and imperfect enforcement mechanism are compelling enterprises in the formal and informal sector to leave the State. High cost of transport, power, transaction, information and enhanced risk are all largely a result of crisis of governance and political policy.

There is no political vision for the deep changes needed to make investment happen leading to a `low investment-low productivity-low growth trap'. The range and depth of underdevelopment in Bihar was caused by mis-governance since the 1970s. The period from 1980 to 2005 witnessed the worst kind of deterioration. Governance has basically three dimensions: Regulation, development and welfare.

Regulation is is directly related to the law and order and the criminal justice system. Postings and transfers in the State bureaucracy, that is, the police and the district administration, are seldom made on merit.

Poor policing has obvious implications for the maintenance of law and order. Kidnappings and abductions have flourished almost like an industry. The deep sense of insecurity has prompted many industrialists/traders and professionals (doctors, engineers) — most likely targets of such activities — to flee the State. Similarly, the cases of murder, loot, rape and dowry deaths have increased since the culprits are not duly punished.

The 2005 magazine survey looked at the recovery of stolen property and the completion of trials and constructed a `Protection Index' for a sample of States. Tamil Nadu topped the list of big States with the highest score of 0.55 on Index, followed by Madhya Pradesh (0.54) and Kerala (0.49). Bihar ranked 19th with a score of 0.14, just above Jharkhand (0.13).

Recently, the Prime Minister asked the States to ensure that `outcomes match outlays' — to increase public benefit from public spending. Nowadays each block gets about Rs 50 crore a year, under Plan heads. But block offices are not well-equipped with account officers, engineers and supervisors to plan, monitor and evaluate the scheme works.

In this era of globalisation, Bihar suffers most because the private sector does not invest there.

(The author is a member of the Indian Revenue Services. The views are personal).

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