Complete Notes on Key Economic Indicators of Bihar for BPSC and Other Competitive Exams in 2025
Economics- 14
Key Economic Indicators of Bihar
Bihar’s economy is experiencing strong economic growth, with its Gross State Domestic Product (GSDP) reaching an estimated ₹8,54,429 crore for 2023-24 at current prices, placing it among India’s fastest-growing states. The economy is primarily service-led, followed by industry and agriculture, though agriculture remains a key sector employing a large portion of the workforce. Key indicators show significant growth in the state’s economy and a focus on developing its service sector and improving its Human Development Index.
1. GSDP Growth Trends
Definition:
- GSDP (Gross State Domestic Product) is the total economic output of a state in a financial year.
- It reflects the overall growth performance and economic health of the state.
Bihar’s GSDP Trends (Recent years):
| Year | GSDP Growth Rate (%) |
| 2017–18 | 11.3% |
| 2018–19 | 12.1% |
| 2019–20 | 10.5% |
| 2020–21 | -3.1% (COVID impact) |
| 2021–22 | 15.9% (Rebound) |
| 2022–23 | 10.5% |
| 2023–24 (Est.) | 9.8% |
Key Points:
- Bihar consistently outpaces national growth rate, especially in recovery years.
- High growth is driven by government spending, construction, and public services.
- Growth is not fully translating into income and employment gains due to structural bottlenecks.
2. Sectoral Contribution to GSDP
Structure of Bihar’s Economy:
| Sector | % Contribution to GSDP (2022–23) | Trend |
| Agriculture | ~23% | Declining share, but high employment |
| Industry | ~19% | Growing slowly |
| Services | ~58% | Dominant contributor |
A. Agriculture:
- Employs nearly 70% of population, but output is only ~23% of GSDP.
- Productivity remains low.
- Crops: Rice, wheat, maize, pulses, sugarcane.
- Govt support: Krishi Roadmap, PM-KISAN, irrigation schemes.
B. Industry:
- Limited industrial base, post-bifurcation.
- Focus areas: Food processing, textiles, brick kilns, handlooms.
- Growth through MSMEs, startup policy, industrial incentives.
C. Services:
- Largest contributor (~58%) to Bihar’s GSDP.
- Includes government jobs, education, health, finance, trade, logistics.
- Fast urban growth in cities like Patna, Bhagalpur, Muzaffarpur.
3. Per Capita Income (PCI) vs National Average
PCI Definition:
- Income earned per person in a year.
- Calculated as:
PCI = Net State Domestic Product (NSDP) ÷ Population
Comparison (2023–24 Estimates):
| Indicator | Bihar | India (Average) |
| Per Capita Income (Nominal) | ₹54,383 | ₹1,72,000+ |
| Rank among States | Lowest | – |
Insights:
- Bihar’s per capita income is less than 1/3 of national average.
- Causes:
- High population density
- Agrarian dependence
- Low industrial wages
- High migration
Efforts to Improve PCI:
- Employment schemes (e.g., MNREGA, Start-up Bihar)
- Skill development (e.g., Kushal Yuva Program)
- Promotion of rural entrepreneurship
Summary Table: Key Economic Indicators
| Indicator | Status |
| GSDP Growth (2023–24 est.) | ~9.8% |
| Largest Sector (GSDP share) | Services (~58%) |
| Per Capita Income (2023–24) | ₹54,383 |
| Contribution of Agriculture | ~23% |
| Bihar’s PCI vs India | ~32% of national average |
Social and demographic indicators
- Poverty: Bihar has the highest multidimensional poverty rate in India, at 33.76% as per the 2023 NITI Aayog Multidimensional Poverty Index (based on NFHS-5 data for 2019-21). The state did, however, record the fastest reduction in its poverty headcount ratio during the same period, pulling over 3 crore people out of poverty.
- Inflation: Inflation rates in Bihar are monitored regularly. In July 2024, Bihar’s inflation was 6.37%, higher than the national average.
- Labour force:
- Participation Rate: The Female Labour Force Participation Rate has improved but remains below the national average.
- Unemployment Rate: At 3.9% in 2022-23 (for ages 15+), it was slightly above the national average of 3.2%.
- Sectoral Employment: A large majority of workers are concentrated in agriculture, followed by services and construction.
Objective Questions
1. What was Bihar’s approximate GSDP growth rate in 2022–23?
A) 5%
B) 8%
C) 10.5%
D) 15%
Answer: C
2. Which sector contributes the most to Bihar’s GSDP?
A) Agriculture
B) Industry
C) Services
D) Mining
Answer: C
3. What is the approximate Per Capita Income of Bihar (2023–24)?
A) ₹1.5 lakh
B) ₹75,000
C) ₹54,000
D) ₹1.8 lakh
Answer: C
4. The agricultural sector in Bihar contributes around what percent to GSDP?
A) 10%
B) 23%
C) 40%
D) 55%
Answer: B
5. Despite high GSDP growth, Bihar’s PCI remains low due to:
A) High urbanization
B) Excessive industrialization
C) Low productivity and high population
D) Export-oriented economy
Answer: C
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