Every state economy is based on certain key aspects and parameters. The first ones that easily come to my mind are:
Barring technological developments and, somewhat, infrastructure, Bihar can proudly boast to have the other mentioned ones. Post the carving out of Jharkhand, probably we turned weaker in Natural resources as well. But can the likes of even Japan and Singapore claim to have all these as much as we do.
Even if we do away with the highly aspirational references of Singapore and Japan, we have many Indian states ahead of us despite not matching us in these requirements for a healthy economy and growth. One that always comes to inspire me is Goa. The parallels that I am trying to draw hopefully will make sense.
Let us see some contrasting economic prowess and indicators of these two states.
Bihar
1. In 2022-23, Bihar’s GSDP at current prices is projected to be Rs. 7.45 trillion (US$ 97.39
billion).
2. GSDP expanded at a CAGR (in Rs.) of 10.43% between 2015-16 and 2022-23.
3. The per capita GSDP increased to Rs. 50,555 (US$ 690.6) in 2020-21.
4. The per capita GSDP rose at a CAGR of 8.76% (in Rs.) between 2015-16 and 2020-21.
Goa
1. Gross State Domestic Product (GSDP) was Rs. 914.17 billion (US$ 11.09 billion) in 2022-23.
2. The GSDP (in Rs.) increased at a CAGR of 6.41% between 2016-17 and 2022-23.
3. Per capita GSDP was Rs. 544,865 (US$ 6,613), one of the highest in India, in 2021-22.
4. Per capita GSDP (in Rs.) increased at a CAGR of 6.87% between 2015-16 and 2021-22.
These two data sets (source:IBEF) depict so much of the respective standing, comparison, difference and points to ponder.
Now let us see the “Key Sectors” mentioned by both of the respective states. (source:IBEF)
Bihar has mentioned its key sectors as below:
1. Agriculture and Allied sectors
2. Sugar
3. Tourism
Goa’s “Key Sectors” are:
1. Tourism and hospitality
2. Fisheries
The common “Tourism” sector lets us sit to note and learn some aspects which probably help one state being way ahead than the other. As a professional having been exposed to both the states’ working, one very pertinent point that should be mentioned here is the timely response of Governments of Goa in the last decade and half is moving away from, once mainstay, mining industry. Starting from 2012, the Goan economy was hit real hard by the closing down of the mining industry there. The one industry caused a chain reaction and negatively impacted the other sub sectors like transportation, petrol pumps, selling of trucks and trolleys, consumption of tyres and tubes, and so on. After Hon’ble courts’ stern statements slowly brought the state’s attention to tourism and hospitality in a bigger way. That is even today getting stronger by day.
As per the Goa State Budget 2022-23:
❖ Rs. 2.5 crore (US$ 0.32 million) has been allocated to the Goa Tourism Board.
❖ Rs. 80 crore (US$ 10.32 million) has been allocated for various tourism infrastructure development projects.
❖ Rs. 2 crore (US$ 0.26 million) has been allocated under the ‘Tourist Guide Certification Scheme”,
which is expected to increase the base of tourist guides to around 1,000 guides over the next two years.
As per the Bihar State Budget 2023-24:
❖ 417 crore has been allocated to the Tourism Department.
This comparison is not only to present the size of the budget but size of the intent, foresight, planning, deliberation and short/long term goals. We hope and expect a big leap in the tourism related reforms under the young Dy. CM who looks after the ministry.
What can further be expected from authorities are crystal clear tourist clusters related to the plan and responsibilities delegated. Hostels and guides are two immediate areas of improvement and development. Our religious tourism focuses should be extended to regions of Mithila bordering Nepal. We can also maneuver to bring our own people to tourist places. A vast population of Bihar travels around but have
never ever visited our own sites and spots. There is merit in borrowing some insights from Goa to shift and extend focus when one mainstay is under doldrum. They don’t even talk of mining. We should also be clear on what we shall talk of consistently and what we shall not, at all.
Bihar – Drawing straight lines
Now let us discuss two other salient points which our state seems to be ignoring or being ignorant of the loss it is causing at present and it will in the long run. Interestingly both are so much more intertwined than they look. These are
1. Technological upgradation
2. MSME
If India is being discussed all over the world for showcasing its resilience and openness to take Technology driven changes to its remotest of places, manufacturing and services are not far behind. In fact the latter two are complementing digital initiatives. Indian companies are fast moving to adopt technology towards attaining economy of scale to sales and services, marketing and banking. It is but a surprise that MSMEs are not far behind in adoption of technology, albeit on the basis of their financial strength and ability to generate profits. Technological upgradation is being discussed in both corporate boardrooms and MSMEs’ core teams.
These companies have realised for life that Technological upgradation is needed for survival and not just growth.
Talking of Bihar, we might not have many boardroom driven companies but not many would know that as a state we are the fourth largest state, with respect to UDYAM Registered MSMEs. As a professional, this is music to my ears. This simple looking development has a huge significance and shift in the entrepreneurial mindset of the state. For me this is a communique of these MSMEs to both the Governments that “If you don’t want to count on us, you will have to count us. We are here as much and as many. We want to play our role. Look at us, help us thrive, help us come on the map of the country. We shall find our ways to be featured on the map of the global markets.”
At the time of this article being written, the number of UDYAM registered MSMEs (as per the new GoI definition, 2020) for the state of Bihar is as below:
| Total UDYAM Reg. | Micro | Small | Medium |
| 601907 | 590403 | 10909 | 595 |
Even more noteworthy is the fact that each of the 38 districts of Bihar has UDYAM registered MSMEs with Patna showing a total of 76406 units (max.) and Arwal has 2525 units (min.).
Bihar – Drawing new picture
For us, MSME base is good enough to nurture and work setting medium to long term plans. The MSME universe of the state can easily stop migration of the labour and entry level employee base up to an extent.
To make this MSME base grow exponentially, create sizable employment and add muscles to GSDP in a couple of years, there has to be a roadmap.
This ten-point agenda may fetch us reason to celebrate our MSMEs as some other state and India as a
country are doin.
1. Complete profiling of these MSMEs by respective DICs
2. Training and development (phygital) of owners
3. Making each of them aware of ways and means of bank loans
4. Skill development of workforce
5. Savings Bank account for every employee
6. Selection of export potential units
7. Bringing some of them (processed food, handicrafts, fmcg etc.) on e-commerce sites.
8. Alignment of suppliers of raw materials.
9. Promoting Public Procurement Policy and sourcing through MSMEs.
10. Create an ecosystem for these MSMEs under the Industry Department
Government can form a State Board for MSMEs to superwise and lead the action.
Bihar being my homeland I may be a critic for various issues but wearing the hat of a professional I quickly see opportunities and potential both.
Data Sources: IBEF, Govt. of Bihar published data, UDYAM.
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Disclaimer : I have dared to talk and pen down my thoughts going beyond area of expertise and not being an economist. However, Biharis can’t wait to be economists to discuss development of Bihar with speed and scale.
Avinash Chandra Jha
Author – Avinash Chandra Jha
Head – MSME & GTM Strategy, Spicemoney
Picture – Aditi Nandan
