Datanomics: Challenges galore as Bihar celebrates foundation day

As Bihar celebrates its foundation day on Saturday, the state continues to face many economic challenges. It has the country’s lowest per capita income, which has been struggling to touch even one-third of the national average, and is 11 years behind it.

 

Bihar’s per capita income was one-tenth of Sikkim, which was the top state in 2023-24. It was 19 per cent of Tamil Nadu’s, which ranked 7th in FY24. The state was 14 years behind Tamil Nadu, and 19 years behind Goa and Delhi in terms of per capita income in FY24.

 

Bihar’s per capita income was just 64 per cent of Uttar Pradesh’s, which had the second-lowest rank in FY24. Jharkhand, which was part of Bihar before November 15, 2000, and the bottom third state on the list, had 75 per cent higher per capita income than the parent state in FY24.

 

Bihar is also the poorest state in the country in terms of multidimensional index even as the poverty rate fell from 51.89 per cent in 2015-16 to 33.76 per cent in 2019-21. Trends of the past few years have shown that the state’s own tax revenues constitute just one-fourth of its total revenue receipts, with the share of central taxes much higher than its own tax revenue (OTR). Its capital outlay is struggling to go beyond 4 per cent of its gross state domestic product (GSDP), as much of the expenditure is spent on revenue heads.