Poor infrastructure, weak human capacity, politicised local bureaucracies, difficult caste relations, debilitating power shortages and deeply entrenched poverty – driving around Bihar recently, it was clear that the state has yet to transform into the orderly, prosperous society that recent press coverage has suggested. That said, there is no doubt that a nascent but carefully structured institutional reform process is allowing for the slow emergence of a 'naya' Bihar. Since 2005, the government of Nitish Kumar has consolidated rule of law, built critical infrastructure, begun to deliver services, increased revenues and expenditures, improved bureaucratic functionality, and generated an important sense of citizenship among many of the state's communities. The economy has grown at over 10 percent per year for the past six years, despite the separation of resource-rich Jharkhand in 2000, periodic floods and droughts, and the recent global financial crisis.
Fifteen years ago, Nepalis would look to Bihar and bemoan their luck for being located next door to one of the most corrupt, crime-prone and poverty stricken states in India, from which migrants would flood northwards in search of livelihoods. Now it is the Biharis that look across the border, wondering when criminal gangs will be brought under control and seeking to draw on Nepali labourers to support the state's construction boom. In many ways, Nepal is far wealthier than Bihar in terms of relative capacities, structures and assets. The difference is that the current administration in Patna is moving to consolidate positive changes and create a virtuous circle of growth and development – albeit starting from a low base – while Nepal continues to struggle with difficult issues of state and market-building. While the ongoing changes in Bihar must be considered in the context of their own unique history, the current situation nonetheless poses two, inter-related questions: What broad trends can be identified from the recent history of Bihar that might be relevant for Nepal? And how can Nepal benefit from the positive changes happening to its south?
Most writings on the recent history of Bihar look toward plans put in place by Nitish Kumar's governments across a broad spectrum of issues. These have included the rule of law (drafting 11,000 policemen), infrastructure (building nearly 25,000 km of roads), governance (signing the Bihar Special Court Bill and the Anti-Corruption Act), and service delivery (the appointment of 300,000 teachers and the dramatic improvement in public-health facilities). These are all important changes, but such explanations are often more descriptive than analytical, and provide a simplistic, linear conception of transformation.
At its core, Bihar's transition has been based on a combination of several closely linked factors. The first is strong leadership by Nitish Kumar and his team. The key decision-makers in Bihar have spent periods of service in the national government, which has provided important experience in the management of complex organisations and has expanded conceptions of what is possible in governance terms. Traditionally, Biharis have respected power, but now power is being combined with legitimate authority, which is allowing for progress.