Bihar Budget- Good, But Expected Better

by Indra

March 4, 2006

Mr. Modi has presented his first budget for Bihar, and done a pretty good job. Unfortunately, the whole budget is not available on the website of Bihar government or any other. Paatnadaily.com would have provided this as many sites do; as it provides vital indicators to find where the state will be after a year. However, I am writing this feature based on the materials available in media.

Some of the highlights and my views on it are here:

· Rs 125 crore has been allocated for the "Mukhya Mantri Gramin Sadak Yojana" to connect villages having population between 500 and 1,000 with all-weather roads. Further, in order to strengthen infrastructure, allocation for the road sector was increased by 70 per cent from Rs 925 crore in 2005-06 to Rs 1562 crore in 2006-07.

I don’t understand if ‘Mukhya Mantri Gramin SadakYojana’ is additional to central government programmes for village roads such as ‘Pradhan Mantri Gramin Sadak Yojana’ or the road projects under ‘Bharat Nirman’. I suggest that one minister in Bihar government must coordinate the projects in Bharat Nirman and get the maximum of the projects sanctioned implemented fast. With a minister from Bihar in charge of the rural development, it will be easier for Nitish government to get that done. The government also must do its best to get cleared all the hurdles under the state’s control in the implementation of GQ and East-West Corridor Expressway. It will boost the state economy tremendously.

· For electricity, a crucial factor in industrialisation, the allocation has been raised from Rs 477 crore this year to Rs 753 crore. Besides, Rs 412 crore has been earmarked to bridge the resource gap of Bihar state electricity board.
The government must try to allure private investment in power generation or get the central mega projects of electrical generation in the state. The state has abundant hydropower potentials in north Bihar. The government must use some consultants to explore possibility of setting up small, medium, or large hydroelectric projects. It will help for power generation, irrigation, fishery, and tourism too. This is an area that has remained unexplored in last 59 years.

· To boost farm output; the government has earmarked Rs 1,212 crore for irrigation.
I don’t know if it is for new irrigation canals. The central government has allocated a lot of fund for renovation of water bodies. The state government must take advantage of the programme.

· To boost private participation in higher education, the government announced 50 per cent exemption on stamp duty for registration of land by parties interested in opening engineering and medical colleges. He has set aside Rs 40 crore each for setting up a national law college and extension centre of Birla Institute of Technology in the state capital.

I still suggest some extra PR effort to attract the educational trust and institutions that are establishing professional institutes. One such name is ICFAI Business School that plans to set up a private university in every state, with UGC approval. I don't know if the Bihar government has enacted a private universities Act, like the other states. If it has not, it must do it. The PR must work with business houses such as Reliance, Infosys, Tata, or ITC who show interest in education. Bihar government must get the Central government programme of development of it is implemented. The government must pick some reputed college such as Science College, provide a Rs 50 crore loan for research in cutting edge areas and give them a status of the institute of excellence.

To strengthen the social sector, Rs 4886 crore has been provided for primary, secondary and higher education which includes state's share of Rs 384 crore under "Sarva Shiksha Abhiyan", Rs 165 crore for mid-day meal scheme and Rs 75 crore for payment of honourarium to "Shiksha Mitras".

The government must come out a proposal for fresh training of the rural teachers and tie them with some responsible village committees. Many of the teachers are not qualified and may be that many may be having fake certificates. I still think every district headquarter must have an education hub with different types of good institutions and ITIs.

To improve healthcare facilities, Rs 1,240 crore has been allocated for the health sector, including Rs 326 crores under plan and Rs 914 crore under non-plan heads. While Rs 281 crore would be spent on medicines and repair of hospitals, Rs 78 crore would be invested in construction of new hospitals. Private participation would be encouraged in pathology, radiology, maintenance and upkeep of hospitals, ambulance services and mobile medical units.
The government must attract the NRIs or domestic entrepreneurs such as Apollo, Manipal or Fortis to setup world-class hospitals by providing incentives better than other states are providing.

With a view to giving a fresh thrust to industrialisation a state investment promotion council has been constituted and Rs 205.33 crore set aside for "land bank scheme". Under land bank scheme, land would be acquired in advance to be sold to prospective investors to promote industrial investment. A new sugar policy has been announced. It abolishes the purchase tax on procurement of sugarcane by mill owners.

The government must concentrate on food processing industry, and facilitate the agricultural institutions to facilitate entrepreneurs. If Acharya NG Ranga university in Andhra can contribute so much with its research, why can’t Pusa Institute.

Rs 500 crore was earmarked for integrated development of Patna and Bodh Gaya under Jawaharlal Nehru National Urban Renewal Mission. The government also exempted multiplexes from entertainment tax to encourage entertainment industry.

The government must build a six-lane expressway connecting Muzaffarpur, Patna and Gaya, and develop some business hubs and World Buddhist City on Golden Quadrilateral near Buddha Gaya.

Rs 120 crore has been earmarked for the employment guarantee scheme launched in 15 of the state's 38 districts through government's own resources. The centre-sponsored National Rural Employment Guarantee Programme does not cover these districts.

The government must ensure the transparency in the delivery system and come out with the projects that are real national assets.

For improving law and order, Rs 133 crore would be spent on modernisation of the police force, which would be strengthened through recruitment of 2,500 sub-inspectors and 10,000 constables. A sum of Rs 5 crore has been set aside for modernisation of prisons.

Instead of increasing the number, the effort must be made to raise its morale and efficiency. The salary and perks must be raised.

A sum of Rs 20 crore has been set aside for minority welfare under which boundaries will be constructed at graveyards, construction of hostels for students of minority communities, and towards share capital of national minorities' development and finance corporation and state minorities financial corporation.

The government must do every thing to bring the minority community in main stream particularly for education.

Modi has promised to place an Outcome Budget (on line of the Central Budget) detailing the physical assets proposed to be created by the government during the next financial year in the third week of this month before the budget is passed.

This is a good practice if followed honestly. It will fix accountability.

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