Complete  Notes on Major Changes in the Economy of Bihar – Post-Independence for BPSC and Other Competitive Exams in 2025

Complete  Notes on Major Changes in the Economy of Bihar – Post-Independence for BPSC and Other Competitive Exams in 2025

Economics- 8

Economy of Bihar

Bihar, located in eastern India, possesses a largely service-based economy despite a significant agricultural foundation. While still facing developmental challenges, the state has witnessed commendable economic growth in recent years. 

Key sectors

• Services: This sector forms the largest contributor to Bihar’s economy, accounting for approximately 58.6% of its Gross State Domestic Product (GSDP).
• Industry: The industrial sector, including manufacturing and construction, contributes around 21.5% to the GSDP. Construction is a major driver within this sector. Rapidly expanding industries include food processing, dairy, sugar, and healthcare.
• Agriculture: Though its share in GSDP has declined, agriculture and allied sectors remain crucial, employing the largest portion of the workforce (around 76%). Major crops include rice, wheat, maize, pulses, and sugarcane. Bihar is a significant producer of vegetables, fruits, litchis, makhana, and honey.

However here we will focus on the “Major Changes in the Economy of Bihar – Post-Independence” in brief

• Agrarian Economy
• Low Industrial Base
• Heavy Dependence on Agriculture and Allied Activities

Major Changes in the Economy of Bihar – Post-Independence

Under: Economic Profile Post-1947

1. Agrarian Economy

Post-1947 Scenario:

• Dominated by agriculture: More than 80% of the population dependent on farming.
• Zamindari abolition (1950s): Land redistribution aimed at empowering small farmers but implementation remained weak.
• Agriculture remained subsistence-oriented, not market-driven.

Features of Agrarian Bihar:

• Small and fragmented landholdings.
• Low productivity and minimal mechanization.
• Heavy dependence on monsoons and traditional methods.
• Dominance of paddy, wheat, maize, and pulses in cropping pattern.

Land Reforms (attempted but partially successful):

• Bihar Land Reforms Act, 1950 abolished Zamindari.
• Land Ceiling Acts were introduced but evaded by landowners.

2. Low Industrial Base

Post-Independence Conditions:

• Bihar had rich mineral resources (coal, iron ore, bauxite), but industrial development was minimal.
• Lack of infrastructure, skilled labor, and political will hindered growth.

Post-Bifurcation (2000 onwards):

• Jharkhand carved out in 2000, taking away major mineral-rich areas.
• Remaining Bihar was left with limited industrial base.

Challenges to Industrialization:

• Poor power supply and road connectivity.
• Law and order issues (especially during 1980s–1990s).
• Low private investment.
• Weak policy implementation and bureaucratic hurdles.

Current Initiatives:

• Promotion of Food Processing, Textiles, Leather, Handicrafts, and IT parks.
• Industrial corridors and startup policies under consideration.
• However, Bihar still ranks low in per capita industrial output.

3. Heavy Dependence on Agriculture and Allied Activities

Occupational Structure:

• Around 70% of workforce engaged in agriculture and allied activities.
• Dairy, fisheries, animal husbandry supplement rural income.

Issues in Agriculture:

• Landlessness and marginal landholding.
• Low irrigation coverage (~60% area irrigated).
• Frequent floods (North Bihar) and droughts (South Bihar).
• Low crop diversification.

Crop Pattern:

• Kharif: Paddy, maize
• Rabi: Wheat, pulses, mustard
• Limited horticulture and cash crops

Recent Developments:

• Bihar Agricultural Roadmap (latest version: 2017–2022) focused on:
  • Irrigation
  • Seed replacement
  • Farmer Producer Organizations (FPOs)
  • Agricultural mechanization and extension

Allied Activities:

• Dairy sector has seen growth due to Sudha Dairy cooperative model.
• Fisheries and poultry have become major rural employment sources.
• Mushroom cultivation, bee-keeping, and organic farming are being promoted.

Summary of Key Challenges:

Objective Questions

1. Which sector dominates Bihar’s economy post-Independence?
A) Industry
B) Services
C) Agriculture
D) Tourism
Answer: C

2. The Bihar Land Reforms Act was passed in which year?
A) 1947
B) 1950
C) 1962
D) 1975
Answer: B

3. The bifurcation of Bihar and Jharkhand took place in:
A) 1999
B) 2000
C) 2001
D) 2003
Answer: B

4. Which of the following is a major allied agricultural activity in Bihar?
A) Mining
B) Fishery
C) Textile manufacturing
D) Cement production
Answer: B

5. Which organization is responsible for dairy development in Bihar?
A) Amul
B) NAFED
C) Sudha (COMFED)
D) IRCTC
Answer: C

6. What percentage of Bihar’s workforce is engaged in agriculture and allied activities (approx)?
A) 30%
B) 45%
C) 70%
D) 90%
Answer: C