 "Will Budget boost NDA's prospects in Bihar polls with infra, I-T relief?")
In Bihar’s 2020 Assembly election, held in the aftermath of the Covid-forced return migration of workers to the state, the overall result was decided by a mere 12,768 votes of 41.43 million cast.
The Janata Dal United-Bharatiya Janata Party-led National Democratic Alliance (NDA) clinched 125 of 243 seats with a 37.26 per cent vote share, narrowly beating the Rashtriya Janata Dal (RJD)-led Mahagathbandhan (grand alliance), which secured 110 seats and 37.23 per cent of the vote.
The NDA got 15.7 million votes, while the MGB garnered 15.69 million. If not for the NDA’s stronghold in districts like Darbhanga in Mithilanchal, where they won all nine Assembly seats, the election’s outcome could have been very different.
Fast forward to the present: Since Finance Minister Nirmala Sitharaman presented her first full Union Budget of the third Narendra Modi government on July 23, 2024, and again with her Budget on Saturday, there’s been a clear focus on Bihar —especially the Mithilanchal region.
The 2020 Bihar election (held in three phases from October 28 to November 7) was influenced by the aftermath of the 2019 floods, high unemployment, and economic struggles, and the two Union Budgets have tried to tackle those very issues.
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The 2024-25 Union Budget allocated Rs 59,000 crore to improve road connectivity, power, flood management, and other infrastructure projects in Bihar. Months later, Prime Minister Modi visited the state on November 13, 2024, inaugurating and laying the foundation for projects worth around Rs 12,100 crore. A few weeks later, Sitharaman visited Patna and Darbhanga, where she reviewed the performance of regional rural banks, encouraged Uttar Bihar Gramin Bank to provide more credit to fisheries and makhana (foxnut) farmers, and personally handed out loans to local youth.
She even received a hand-painted Madhubani sari from Dulari Devi, an instructor at the Mithila Art Institute, which the finance minister wore during her Budget presentation on Saturday.
Sitharaman’s speech for the 2025-26 Budget included several initiatives aimed at Bihar’s development, such as setting up a Makhana Board, creating a National Institute of Food Technology, Entrepreneurship and Management in Bihar, and financial support for the Western Koshi Canal project, which will benefit farmers cultivating over 50,000 hectares of land in Mithilanchal. The total allocation for this project is Rs 11,500 crore.
K P S Keshri, president of the Bihar Industries Association, welcomed the Budget’s Bihar-specific measures but highlighted the importance of the Western Kosi Canal. “Given Bihar’s recurring flood issues, an efficient canal system could regulate water during floods and ensure availability during lean periods. This could be transformative for the state’s agriculture and economic stability,” he said. However, Keshri also pointed out that Bihar still needs more investment in infrastructure.
“Bihar’s economic development requires more backing,” Keshri continued. “We’ve suggested a Rs 50,000 crore interest-free loan from the Centre over 10 years to help bridge the state’s development gap. Once Bihar catches up to the national average in economic indicators, the state could repay the funds.”
The industry lobby also called for a full development of National Waterway 1, which runs through Bihar along the Ganga, to maximise economic benefits. “Education needs significant investment as well, since our schools lack adequate resources. While this Budget lays important foundations, execution is key,” Keshri added.
D M Divakar, former director of the A N Sinha Institute of Social Sciences in Patna, had a more cautious take on the Budget’s impact on Bihar’s rural economy. “The income tax relief that the middle class got is good, but Bihar (population) is largely rural. There is just a 0.4 per cent increase in the rural development budget. The rural development economy of Bihar will not get enough benefits. This is a middle-class Budget, and for a state where only 11 per cent of the population lives in urban areas and where the middle class is small, the effect will be limited.”
He also pointed out that Bihar’s agricultural challenges remain. “The agricultural roadmap for Bihar is struggling, and with this Budget, it will continue to face issues. While the Centre’s concern for Bihar is clear, the big hopes the state had from this Budget are largely unfulfilled,” Divakar remarked. He also noted that a 1 per cent decrease in Bihar’s fund transfers from the Centre could further hurt progress.
Rajeev Ranjan, national spokesperson for Janata Dal United (JDU), credited the party’s national executive president and MP, Sanjay Kumar Jha, for facilitating Sitharaman’s visit to Mithilanchal, where she became aware of the challenges faced by makhana farmers, including middlemen’s involvement. The creation of the Makhana Board followed shortly after.
In late December, Bihar’s Deputy Chief Minister Samrat Choudhary sent a detailed memorandum to the Finance Minister, requesting support for upgrading Darbhanga airport, developing new airports in Rajgir, Bhagalpur, and funding for Raxaul airport. The Finance Minister announced her support for greenfield airports in Bihar, and she also revealed a Rs 20,000 crore Nuclear Energy Mission for the development of Small Modular Reactors (SMRs). The government aims to have five such reactors operational by 2033, raising the question of whether Bihar will be one of the beneficiaries.
According to the Bihar Horticulture Development Society, India produces 90 per cent of the world’s makhana, yet only 200 million tonnes of makhana pop are exported due to traditional methods of harvesting. The Society’s data shows that the area under makhana cultivation in Bihar has increased by 171 per cent in nine years, from 13,000 hectares in 2012-13 to 35,224 hectares in 2021-22. Makhana cultivation is concentrated in 10 districts of Bihar, including Darbhanga, Madhubani, and Sitamarhi, where approximately a million farmers — many from extremely backward castes (EBCs) — are involved. While the JDU-BJP coalition performed well in these regions during the 2020 Assembly elections, the RJD is trying to build rapport with the EBC community.
Mithila’s makhana received a Geographical Indication (GI) tag in 2022, giving it further recognition.
In late December, Bihar’s Deputy Chief Minister Samrat Choudhary sent a detailed memorandum to the Union Finance Minister, requesting support for upgrading Darbhanga airport, developing new airports in Rajgir, Bhagalpur, and funding for Raxaul airport. Sitharaman in the 2025-26 Budget announced support for greenfield airports in Bihar, and she also revealed a Rs 20,000 crore Nuclear Energy Mission for the development of Small Modular Reactors (SMRs). The government aims to have five such reactors operational by 2033, raising the question of whether Bihar will be one of the beneficiaries.
With Bihar’s 2025 Assembly elections slated for October-November, it’s likely that the NDA government at the Centre will continue to roll out more assistance for the state. Whether these efforts will translate into political gains for the ruling coalition, however, will ultimately depend on how Bihar’s electorate responds.
