Reform in Practice: Prachi Mishra (Ashoka University) on a Growth Roadmap for Bihar

Let me take this opportunity to talk about a report which the Isaac Centre for Public Policy at Ashoka University is working on. The report focuses on Bihar, and actually, it's a very forward-looking report in terms of providing an economic roadmap for Bihar. Bihar's per capita income is about one-third of the all-India average. In fact, it's the poorest state in the country. That said, I think in recent times, Bihar is achieving very high rates of growth, growing  at more than 8%. The infrastructure development, in particular roads, electricity, also has been quite impressive.

This report will really focus on how Bihar can capitalize on it. The goal is to achieve growth rates. We show that Bihar would need double-digit growth rates in order to narrow the gap in per capita incomes between Bihar and rest of India in the next two decades. Our broad focus is on strategic industrial policy. There are three sectors in particular which we focus on. First is agro-industrialization. Under agro-industrialization, we focus on exploiting geographical clusters or geographical connectedness and input-output linkages. For example, maize has been a big success story in Bihar, and how you can build maize-based clusters, and that could have multiplier effects for both industry as well as services.

The second sector with immense potential is tourism. Bihar has culture, heritage. The report will have specific recommendations on taking the tourism sector as one of the key firing engines, finally, on Global Capability Centers. GCCs is not for the world, but first for the rest of India. All three engines of strategic industrial policy, which we emphasize, have key elements of deregulation. We have to deregulate within each of these areas of strategic intervention to achieve the goal of narrowing the income gap between Bihar and rest of India in the next two decades.