Awakening of BIMARU
The economic growth of Bihar, Madhya Pradesh, Rajasthan and Uttar Pradesh once termed as BIMARU meaning “sick” states in Hindi for its poor economy has now emerged as a miracle economy. The states have increased its economic growth to 11% overall. The productivity of these states has improved the GDP of India to 8.49% in a five year period. The growth rate has been mostly accelerated by these poor states as called before 2004. The old notion of the contribution to the GDP was always by the fast growing economies such as Gujarat & Maharashtra was under stake when the economy of Bihar, Madhya Pradesh, Rajasthan and Uttar Pradesh emerged as a miracle economy from the year 2004-09. Once a country’s economy grows fast, the government’s revenue will boom which indeed will accelerate to the spending in social sectors and welfare of the nation. The Central Government policies reformation in the year 1991 led the slow growing states develop from a potential to a high level growth and acquire local leadership. India’s GDP for the last five years (2003-08) is given below.
India’s GDP in financial year
Below is the average growth rate of the poor states emerging through the development in the recent five years (2004-09).
Development Activities
BIMARU states have emerged as a preferable destination of investor’s cycle. The states like Rajasthan, Bihar, Madhya Pradesh, and Uttar Pradesh have recorded maximum rise in their rankings on investment. Rajasthan has topped the investment chart during 2008-2009. The next investment destination also witnessed major shift as the second place was occupied by Madhya Pradesh as compared to the sixth place last year. Orissa maintained its place in the third position.
Now we compare these states with the development with some of the already established states. Maharashtra and Gujarat team up to the top slots of leadership. The Gross State Domestic Product in the year 2009-10 of Maharashtra is said to hit 8.6%. It continues to be the investor’s favorite destination both for domestic and foreign arena. All the sectors are well developed along with Engineering, Electronic Hardware, Automobiles, Consumer durables, Petrochemicals, Pharmaceuticals, Information Technology and Biotechnology. Mumbai remains it position to be called as the commercial capital of the country and more than 50% stock transactions happen here. Now when we see the development around Gujarat we find that it accounts for16% of the India’s total investment. The state mainly aims in the manufacturing sector, exports and stock market capitalization. There is a high level of industrialization in this state which accounts to US $ 30 billion.
Development Activities (State wise)
Bihar
Bihar was one of the economically backward state before 2000 but in the recent past it has documented a growth of 11.44% in the year 2008-09. The per capita income being $148. The GSDP showed an increase when the global financial state was declining. The economy of Bihar is mainly service oriented and depends also in agriculture. 35% is contribution from the agricultural sector, 55% by the service sector and the remaining and the rest is contributed by the industrial sector. Bihar has tremendous resources and their utilization in the interest of its growing population has to be the supreme responsibility of both the state administration and the national planners. Reliance Industry is given the opportunity for their investment in Bihar. Lot of industrialization is taking place in this state economy. Food grains production was 60 per cent higher in 2008-09 than in 2004-05. A lot of scope can be exploited in the economy that is unutilized.
Rajasthan
Rajasthan has turned down to be the 8th largest economy. The net state domestic product is US$11.5 billion. The industrial sector has undergone a growth of 6.9% and for the service sector it is 7.4%. Rajasthan being the second largest producer of mineral has got the advantage of prospering high. It produces textile, rugs, woolen goods, vegetable oil. Heavy industries consisting of copper and zinc smelting and the manufacturing of railway rolling stock are also produced.
It has almost 90% of the total reserves in the economy. It contributes to 22.5 % on agriculture. The revenue earned by the tourism in Rajasthan is 15% of its economy. It is totally based on Infrastructure, Transportation, Energy, Power, Telecommunications, and Banking & Financial Institutions. The state decided to work on few sectors which contribute for the development such as animal husbandry, agriculture, mining and manufacture.
Orissa
Orissa stands 1st in the total envisaged investment in manufacturing sector for past 5years. Orissa has targeted an annual GDP growth of 9% in agriculture. The state has signed 49MOUs for setting up steel plants for a production of 74.66 million tons of steel. The economy is fast growing and they need to be well accessed with the reserves of the state so as to enhance their development. The economy has now found out a special Investment region at Dharma. It has got investment opportunity in petroleum and petrochemical sector. It has sector of development in IT. The tourism industry also contributes a lot to the GSDP of the economy. The economy is growing at a faster scale of 8.74%.
Uttar Pradesh
Uttar Pradesh (UP) is the 2nd largest economy in India after Maharashtra, contributing 8.17% to India’s total GDP. The contribution to Gross State Domestic Product (GSDP) in 2004-2005 was US$ 55 billion. UP is a predominantly agrarian economy, agriculture is the highest contributor to the GSDP which is of 66% of its economy. Tertiary sector’s contribution is the maximum extending to 44%. It is India’s fourth largest software exporter contributing to US$ 1 billion. It is one of the top tourist destinations in India, with almost 25% of the All-India foreign tourists visiting Uttar Pradesh. It is one of the most important minerals producer which includes coal, diaspore, sulphur and magnesite, marble, prophyllite, silica sand and limestone. It ranks first in terms of production of wheat, sugarcane, maize, potato vegetables and livestock products, including milk. The IT focus confined to few pockets such as Noida, Greater Noida, Ghaziabad.
The Sahara group has proposed to develop 50 “high-tech townships”; also plans to set up a drinking water project and an international trade centre in Lucknow to help promote handicrafts. The State government has formulated attractive incentives and subsidies on power, transportation, land and capital investment to name a few, for setting up business in the state.
Madhya Pradesh
MP is a diverse state rich in culture and government is now taking suitable steps to tap the same. The Government has initiated several programmes under the auspices of Tribal Welfare Department for the upliftment of the downtrodden with special emphasis on economic upliftment of tribal population since it constitutes to 20% of the state’s population. It has a showed a growth rate of 8.8% for the year 2009 basic drivers of which were 'services' and 'manufacturing'.
Conclusion
We find that the development of Bihar has outdone and growth of Gujarat. It is going neck to neck with the economic development of that of Gujarat. It has emerged as a miracle economy in the period of 2004 to 2009. Therefore we can say “The poor states are poor states are no longer clustered at the bottom of the growth.” The other poor states have also joined the economic development and growth in GDP.
The situation has changed for the betterment now and certainly, the name BIMARU would not hold good anymore for the states: Bihar, Orissa and Jharkhand. The rest of the so called poor states are almost reaching the optimum level. Therefore all round development is going on in the Indian economy and in this the disparities of income will be removed.
