Complete  Notes on Industrial Development in Bihar for BPSC and Other Competitive Exams in 2025

Complete  Notes on Industrial Development in Bihar for BPSC and Other Competitive Exams in 2025

Economics- 12

Detailed notes on “Industrial Development in Bihar” under the heads:

• Lagging Industrial Growth
• Focus Sectors: Food Processing, Handloom, Brick Kilns
• New Industrial Policies (especially Bihar Industrial Investment Promotion Policy – BIIPP)

Industrial Development in Bihar

Bihar has historically lagged behind in industrial development due to infrastructural deficits, poor investment climate, and post-bifurcation resource loss. However, recent efforts have been made to restructure policies, promote MSMEs, and attract private investment through targeted sectors like food processing, textiles, and agro-based industries.

1. Lagging Industrial Growth in Bihar

Historical and Structural Factors:

• Post-2000 bifurcation led to loss of mineral-rich areas to Jharkhand.
• Inherited low industrial base; most industrial hubs (e.g., Bokaro, Jamshedpur) went to Jharkhand.
• High dependence on agriculture and remittances from migrant workers.
• Inadequate power supply, logistics, and skilled workforce.

Current Industrial Status:

• Bihar’s industrial contribution to GSDP remains below 20%.
• Limited large industries, mostly concentrated around Patna, Hajipur, Muzaffarpur, Gaya, Bhagalpur.
• Reliance on small-scale and traditional industries like brick kilns, handloom, and rice mills.

2. Focus Sectors

A. Food Processing:

• Given the agricultural strength, food processing is Bihar’s top-priority sector.
• Crops like maize, litchi, makhana, banana, sugarcane are processed into value-added products.
• Major food parks developed in Muzaffarpur, Bhagalpur, Begusarai.

Government Initiatives:

• Establishment of Mega Food Parks under the Ministry of Food Processing Industries.
• Incentives under BIIPP 2020 for setting up cold chains, packaging units, and agro-industries.

B. Handloom and Textile:

• Bihar has a rich heritage in textiles (especially Bhagalpuri silk, Madhubani prints, and handlooms).
• Important handloom clusters: Bhagalpur, Gaya, Nalanda, Siwan.
• Schemes like National Handloom Development Programme (NHDP) support artisans.
• State government promotes textile parks and skill training.

C. Brick Kilns & Small Manufacturing:

• One of the largest brick-producing states due to fertile alluvial soil.
• Labor-intensive, informal sector with seasonal employment.
• Environmental concerns have led to push for zig-zag kiln technology and regulation.

3. New Industrial Policies – BIIPP

Bihar Industrial Investment Promotion Policy (BIIPP) 2016:

• Aimed to attract investment and employment.
• Incentives included:
  • Capital subsidy (up to ₹5 crore)
  • Interest subvention on loans
  • Reimbursement of SGST, electricity duty exemption

BIIPP 2020 – Key Highlights:

• Focus on 7 priority sectors:
  • Food Processing
  • IT/ITES
  • Textiles & Leather
  • Healthcare
  • Renewable Energy
  • Plastic and Rubber
  • General Manufacturing

Provisions:

• Ease of Doing Business portal for online clearances.
• Land bank development and plug-and-play infrastructure.
• Additional incentives for:
  • SC/ST entrepreneurs
  • Women-led enterprises
  • Backward districts

Other Government Initiatives:

• Single Window Clearance System for investors
• Start-up Policy 2017 & 2022 – to promote young entrepreneurship
• Cluster-based development (e.g., Mithila Painting, Makhana Processing, Bhagalpuri Silk)

Summary Table: Challenges vs. Policy Shifts

Objective Questions

1. Which sector is a key focus of Bihar’s industrial policy due to its agrarian economy?
A) Heavy Engineering
B) Automobile Manufacturing
C) Food Processing
D) Petrochemicals
Answer: C

2. Bhagalpur is known for which traditional industry?
A) Leather
B) Silk and Handloom
C) Brick Manufacturing
D) Furniture
Answer: B

3. Bihar Industrial Investment Promotion Policy (BIIPP) 2020 gives incentives to how many priority sectors?
A) 3
B) 5
C) 7
D) 9
Answer: C

4. Which of the following is a major reason for industrial lag in Bihar post-2000?
A) High literacy
B) Low agricultural output
C) Loss of mineral areas to Jharkhand
D) High urbanization
Answer: C

5. Brick kilns in Bihar are being upgraded for which primary reason?
A) Labor shortage
B) Water consumption
C) Environmental concerns
D) GST compliance
Answer: C