Bihar is a state in eastern India. It is the 12th largest state in terms of geographical size at 38,202 sq/miles (98,940 km2) and 3rd largest by population. Almost 58% of Biharis are below the age of 25, which is the highest proportion in India.

Bihar is divided into 9 divisions and 37 districts, and has Patna as its capital. It has a very rich history, and is also an attraction for travelers and tourists.

Bihar is fact becoming the most desired place for making investments. It is the single most important source of minerals like coal, iron ore and bauxite in India. Due to fertile soil base, large variety of agricultural commodities are produced, such as paddy, wheat, lentils, sugarcane, jute, etc. However, large and small business houses exists in the area of mining and extraction, textiles, sugar mills, rice mills, oil refineries, cement, steel, fertilizers, automobiles and engineering products. There is also availability of skilled and educated workforce. Besides, a vast potential exists in the tourism sector.

It is well known that agriculture is the state’s strength and the government is also encouraging the sector. The present government has constituted a separate “Agriculture Cabinet”, the first of its kind in India. This cabinet is responsible for planning, investment and execution in the agriculture sector to boost up the production of grains and value added products. The main crops and produce (Grains, Fruits & Vegetables all together) of the state are as follows-

Rice, Wheat, Maize (10%), Gram, Moong, Mustard, Makhana (85%), Sugarcane, Honey (13%), Mango (13%), Guava, Litchi (71%), Pineapple, Potato, Brinjal, Cauliflower, Bhindi, Cabbage (Vegetable all together 9%), Dairy products (5023 Coperative societies with 2.54 lacks members established by COMPFED), Fishery and Jute etc. (% shows out of all India production).

Bihar has always been a land of attractive economic opportunities.

The advantageous features of the State are:-

• Responsive administrative set up
• Skilled and hardworking labour force
• Diversified agricultural and industrial base
• Excellent infrastructure network
• Investor friendly environment
• Vast and rapidly expanding consumer markets etc.

Distribution of the Cleared Projects

• New Sugar Mills
• Mega Projects
• Expansion of existing Sugar Mills (7 + 2) 9 & addition of Ethanol Plant Proposals
• Cement Plants
• Power Projects
• Jute Mill
• Handloom Park
• Textile Park
• Tractor Projects
• Mini Steel Plant

Sectors Ripe For Investment

• Food Processing
• Sugarcane (Ethanol etc) – Opportunities for Investment Sugar mills, ethanol, cogeneration
• Textiles & Handlooms
• Leather
• Education, Healthcare & Pharma
• Tourism

The following would be Thrust Areas of the State Government which the entrepreneur can pursue..

1. Food Processing
2. Agriculture based Industries
3. Tourism related Industries
4. Super Specialty Hospital
5. Higher / Technical Educational Institutions
6. Information Technology based Industries
7. Electronic Hardware Industry
8. Textile Industry
9. Energy / Non-Conventional Energy

BIHAR

Thrust Areas

• Agro based industries
  • Cattle feed
  • Jute, hemp, sisal and other fabrics
  • Tea cultivation, processing and packaging
  • Paper
  • Floriculture
• Industries based on medicinal and aromatic plants
• Sericulture /Tasar
• Chemical based industries
• Power generating and allied industries
• Electronic and computers and IT based industries
• Industries based on non-conventional energy
• Livestock based industries, such as dairy, poultry, piggery, equipment meat processing, etc.
• Industries based on recycling of wastes, eco-friendly raw materials and processes.
• Super specialty Health services
• Telecommunications and related products
• Food processing industry
• Tissue culture products
• Seeds and planting materials
• Foods and Vegetable processing
• Bio-technological processes and products
• Post Harvest technologies
• Tourism
• Cold storage
• Plastic and Plastic based industries
• Pharmaceutical drugs based industries
• Leather based Industries
• Technical education
• Ceramics
• Sports Goods
• Packaging
• Metallurgical industries including power intensive units like induction furnaces, furnaces ferro alloys, oxygen plants, graphite and gas plants and calcium carbide plants.
• Textile, hosiery, knitwear
• Handicrafts
• Natural Gas based industries
• Housing fixtures and related industries

Thrust on improving agriculture productivity – imperative

The economies of Bihar state is highly agrarian in nature, characterized by larger dependence of majority of people on the agriculture sector. Hence, concentration on improving the productivity in the agriculture sector and increasing farm income are imperative to bring about an overall development in these states. Focus of these states on improving irrigation facilities and gradual modification of the Agriculture Produce Market Committee (APMC) Act coupled with a host of schemes initiated by the state as well as central governments such as providing subsidy on power tillers are expected to yield results in the long run.

Food processing and agro-based industries to see substantial growth

Bihar’s agro-based industry is expected to be a major growth driver for the economy, engendering large-scale employment in rural areas and high returns for the farmers. Development of this sector would unlock the potential in agriculture and related sectors, in which Bihar has significant strength, by creating vital linkages and synergies between agriculture and industry. Given the endowment of fertile soil and water resources in Bihar, we see significant potential for agriculture development.

• Bihar is the eight-largest food grain producer in the country.
• It is the third-largest producer of vegetables and seventh-largest producer of fruits.
• Total value of output of agro-based industries in Bihar is less than 1% of the national output, despite the fact that the state produces about 10% of India’s total output of common fruits and vegetables.
• Apart from the huge resource endowment, Bihar is also emerging as a fast growing market for food products. As per the economic survey of Bihar, expenditure on food accounts for as much as 65% of the total consumer expenditure of the state. Moreover, at present the processed food market accounts for almost 45% of the total food market of Bihar. The food consumption market of Bihar is likely to double to around र 830 bn by 2015 from the current र 400 bn.

The strong agriculture raw material base indicates significant potential for agro-based industries. According to the annual survey of industries, FY08, agro-based industries account for 88.0% of the total value added of र 11.6 bn of all industrial units. The food processing sector is expected to grow rapidly in the state given that it is supply-rich and is seeing significant improvement in infrastructure facilities. The Agro-Export Zone aims to cover 11 districts with an investment of US$ 2.6 mn to promote Lychee exports. It has an export target of US$ 34 mn over the next five years and envisages to benefit ~10,000 farmers.

Development of Food Parks at Hajipur and Begusarai (sanctioned by the Ministry of Food Processing Industry, GoI)—which would include appropriate infrastructure such as cold storage, cold chain, refrigerated vehicle and effluent treatment plants—is likely to aid the agro-based industry’s growth. The Export Promotion Industrial Park (EPIP) at Hajipur is being developed with an investment of US$ 2.6 mn as a multiproduct export-processing zone by the Ministry of Commerce & Industries, GoI, and the state government. Further, the Air Cargo Complex, proposed to be adjacent to the Patna airport, aims to facilitate export of fruits, vegetables, horticulture products, silk and other exportable items. The complex is promoted by Bihar Industrial Area Development Authority and Airport Authority of India.

The state has begun to see increased investments in the food processing sector

• Within the state, there are 41 projects in the food processing sector, at various stages of implementation, involving an investment of र 4.7 bn.
• Up to October 2010, of the 398 proposals approved by the State Investment Promotion Board (SIPB), 104 were for investment in food processing units.

Moreover, the focus of the state government on reviving the sugar industry is likely to aid future growth of the food processing sector in general. According to the Economic Survey of Bihar, the state government has received over 19 proposals for establishing of green field projects with a total crushing capacity of over 100,000 tonnes/day and distillery capacity of 235 kiloliters/day. This is anticipated to create direct and indirect job opportunities of about 0.21 mn.

Bihar has majorly been an agro-based economy with various small-scale industries supplementing it. Due to its highly fertile land and desired climatic conditions, there are varieties of agricultural produce which are cultivated here. Bihar has significant levels of production for the vegetables like Brinjal, Cauliflower and Ladyfinger and fruits like Mango, Guava and Pineapple. Litchi and Makhana (Foxnut) are two such products, 70 percent of whose national produce is supplied by the state. These facts indicate that there is a need to integrate the rural producers of these to the mainstream economy using food processing technology.

Agriculture

The people of Bihar are largely dependent on agriculture and allied activities for earning their livelihood. Due to flow of several rivers and streams, the land is most fertile over here. Bihar has a total geographical area of about 93.60 lakh hectare, out of which only 56.03 lakh hectare is the net cultivated area and gross cultivated area being 79.46 lakh hectare. About 33.51 lakh hectare net area and 43.86 lakh hectare gross area receive irrigation from different sources. Principal food crops are paddy, wheat, maize and pulses. Main cash crops are sugarcane, potato, tobacco, oilseeds, onion, chillies, jute and roselle. Industries based on agricultural products like sugar mills, edible oil mills, spices and other agro based industries have a good demand and export potential. Besides, Bihar has notified forest area of 6,764.14 sq km, which is 7.1 per cent of its geographical area.

Bihar is the leading State in the production of fruits and vegetables. It is the first largest producer of vegetables and second largest producer of fruits in the country. There exists huge scope of investment in the food-processing sector in the State. Private sector participation is being encouraged in packaging and food processing sectors to ensure better quality. Also, the State welcomes private investment for comprehensive development of tea industry and capital subsidy is available for setting up tea processing units.

Sugar Industry

Sugar industry is the largest agro-based industry in Bihar. This industry generates sizeable employment in the farm sector directly as well as through ancillary industries and related activities. It is estimated that about five lakh farmers and their dependents are engaged in the cultivation of sugarcane and approximately another half a lakh unskilled and skilled personnel, including highly qualified and trained technologists are engaged in the sugar industry in the State. Investment opportunities in sugar and allied industries in Bihar:-

• Green field sugar mills
• Capacity expansion of existing sugar mills
• Ethanol manufacture
• Manufacturing of Molasses based alcohol and commercial spirit
• Cogeneration of power
• Manufacture of bagasse- based paper
• Press- mud based organic manure
• Engineering units related to sugar industry
• Manufacture of sugar- based confectionery items

Textiles

Textile sector offers huge potential to the investors. The State has strong weaving traditions. The total number of weavers in the State is over 90,000. The major locations for the textile industry are Bhagalpur, Gaya, Nalanda, Darbhanga, Madhubani, Siwan and Patna. Bihar is the country’s second State after West Bengal in jute production and jute textiles. Due to availability of raw jute, cheap labour, sufficient power, water and transportation in northern part of Bihar, some jute mills are located in this region. Jute mills are located in Karbisganj in Purnia district, Katibar, Muktapur in Samstipur district.

“There are many areas in Bihar which are known for small-scale textile units. Manpur in Gaya is one such village which is popular for textiles made from handlooms. The same is the case for Bhagalpur district which is famous for silk. The state has at present more than 1,000 handloom societies with more than 10,000 handlooms operating under them. In addition, there are more than 11,000 looms under the powerloom sector located in areas of Bhagalpur, Gaya and Banka.

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