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Bihar’s economy has grown faster than the national economy, but it remains India’s poorest state in terms of per-capita income. It faces challenges such as low urbanization, gender disparities, and low enrollment in higher education. Improving these areas is crucial for Bihar’s prosperity and India’s development goals.

During the past two decades, Bihar’s economy has grown faster than the national economy. Its annual growth rate averaged 7% during the 2000s, and 7.5% during the 2010s (until 2019-20). In comparison, the national economy grew at 6.3% and 6.6% annually during these periods, respectively.

Bihar has also made remarkable progress in closing the gap in education, health and basic amenities. Its gross enrolment ratio (GER), sex ratio at birth, life expectancy, infant mortality, and availability of electricity, drinking water and sanitation have improved significantly to levels only slightly below the national average.

Yet, in terms of per-capita income, it has remained India’s poorest state. This is due to a very low level of initial income preceding the growth spurt and a high population growth rate, which inhibited conversion of higher GDP into the acceleration of per-capita income.

At 3 per woman, its fertility rate is the highest among states. Commensurately, its population growth rate (1.5% annually) is nearly 50% higher than the national average (0.9%).

As a result, Bihar’s per-capita income has been only about 30% of what an average Indian earns. At less than $800 per-capita income, it is still a low-income economy as per the World Bank’s threshold for income groups. Besides the high population growth rate, several other features of Bihar’s economy are symptomatic of its low-income status:

Farm-focused: Dependence on agriculture, construction and non- tradable services, all low-productivity sectors, which account for the bulk of its GDP and employment. A griculture constitutes nearly a quarter of its GDP, and half of employment. Manufacturing accounts for only 6% of total employment, while construction employs three times as many people as manufacturing.

Low urbanisation rate: Only 12% of Bihar’s population lives in urban areas, compared to 35% nationally. Despite showing a rising trend in recent years, its gender indicators remain below the national average. Only 22% of its women were employed in 2023, the majority as self- employed or casual workers.

Low enrolment in higher education: Despite GER in elementary and middle school stages improving to near-national levels, and the literacy rate going up to 61% (compared to 73% nationally), its enrolment ratio in secondary school and above remains low. Dropout rate remains high, and college density (number of colleges per-lakh population) is the lowest across Indian states.

Generous GoI: The state’s tax and non-tax collections are low (at 7% of state GDP). Yet, at close to 30% of its GDP, public spending in Bihar is high compared to other states. The latter is primarily financed by a generous share in taxes and grants distributed by the Centre.

Other challenges include low female participation in labour force and low penetration of digital economy. Under these circumstances, a pathway for Bihar to become a middle-income state in the near future remains elusive. Yet, given that the state accounts for a large (nearly 10%) and increasing share of the population, its prosperity is critical for India to realise its goal of becoming a developed nation by 2047.

So, here are a few things the state might do:

Human capital: Bihar must convert its large population into a resource to reap its demographic dividend. With more than 120 million people, the state would have been the 10th-largest country. It ought to not just further strengthen primary education and health but also prepare its people for technical and professional roles on a war footing. It must develop the human capital that employers nationally and the world over aspire to.

Review agriculture: Bihar is one of the few states that has not shed its share of agriculture in GDP or workforce. The state may commission a holistic review of agriculture to enhance productivity through larger farm sizes, more diversified and higher-value crops, and commercial farming.

Tap into diaspora: Bihar must leverage domestic and international diaspora and investors proactively, not just to attract investments into manufacturing but also into labour-intensive services – that is, activities where future demand for labour would arise globally.

Review public finances: It should look for ways to enhance revenues and ensure accountability and effectiveness of its large fiscal-spending programme. For the latter, public expenditure review and deeper digital adoption could help.

Such policy interventions could unleash a new growth momentum, slow the population growth rate to national levels, and reduce the need for other states to subsidise Bihar perennially. For a Viksit Bharat by 2047, Bihar will have to take a leap out to a more viksit self.

The writer is director general of National Council of Applied Economic Research. Views are personal.

Is attaining gender parity in STEM education sufficient?

In the recent budget speech, the finance minister proudly declared that India now stands among the leading nations worldwide in terms of women’s enrolment in STEM (Science, Technology, Engineering, and Mathematics) education. This significant milestone is a clear testament to the concerted efforts of the Government of India, which has been actively promoting female education in the STEM fields through targeted schemes and programmes such as Vigyan Jyoti, GATI, CURIE, and the IIT supernumerary scheme, etc., aimed at increasing the intake of female students. While these statistics offer hope and progress, a deeper dive into the data reveals an underlying challenge that mars the success story: a significant portion of these graduates fail to transition into STEM-related employment. This raises the question: Is attaining gender parity in STEM education sufficient?

The story of Indian higher education is indeed a delicate dance between modern aspirations and traditional values. Over the last decade, India has made substantial progress in enhancing women’s enrolment in STEM education, from 37% in 2010–11 to an impressive 43% in 2021–22. It’s encouraging to see that women in India have effectively shattered the so-called ‘bro code’ in mathematics classrooms, a realm previously viewed as a male stronghold.

Remarkably, in the 2021–22 academic year, women made up 58% of the total student population in mathematics. While these achievements deserve applause, there is a need to go beyond headline items, as the devil lies in the details. The increase in STEM enrolment is driven by increased enrolment in science courses, while enrolments in more promising engineering and technology streams remain depressingly low at 29.2%. Although the overall increase in enrolment is a big step forward, it doesn’t mean much until academic success leads to job opportunities.

Education is considered a catalyst to increase women’s access to employment and agency. However, despite the increasing number of female graduates, India continues to grapple with the “leaky pipeline” predicament, due to which the transition from education to employment in the STEM fields remains fraught with obstacles. There is a massive gender gap of 81% in research and development, and women only make up 27% of the STEM workforce in India as of 2023. Furthermore, only 19% of scientists in the country are women.

Gender prejudice, whether subtle or explicit, persists in recruitment, advancements, and assessments within STEM professions in India. Moreover, women frequently confront stereotypes challenging their competence in science and technology, which diminishes their prospects for progression and involvement in significant projects. According to LinkedIn data, despite their prevalence in STEM education achievements, women are primarily placed in entry-level positions at 29%, a figure that dwindles to a mere 14% at leadership tiers.

The Prime Minister has launched an ambitious initiative for a ‘Viksit Bharat,’ aiming to transform India into a developed nation by 2047, with a focus on four key pillars: youth, the poor, women, and farmers. However, the stark contrast between the high enrolment in STEM education and their low participation in STEM careers highlights a critical issue, famously termed by Professor Sonalde Desai as the “creation of educated housewives.” This situation reveals a concerning paradox where women, despite their higher education and professional skill sets, are either pushed into or voluntarily adopt domestic roles instead of joining the workforce. This discrepancy has significant implications, affecting the women involved and the wider economic and social fabric.

Economically, it denotes a loss of investment in human capital, with untapped skills and knowledge that could otherwise spur innovation, productivity, and growth, thereby constraining national development. Socially, it perpetuates gender stereotypes, impedes gender equality progress, and sends a backward message about women’s societal roles, diminishing the perceived value of their educational and professional achievements. It also deprives young girls of career-oriented role models, further entrenching gendered societal expectations.

The rising number of women graduating in science signals progress towards achieving gender parity in STEM education, marking a positive advancement. However, this milestone merely marks the initial phase. To fully leverage the potential of this highly educated workforce, concerted actions are essential to dismantle barriers hindering women from entering and sustaining careers in STEM fields.

Addressing this challenge calls for systemic changes across education, home, and work environments. Strategies must include fighting against workplace discrimination and harassment, ensuring equal pay and career advancement opportunities, and supporting work-life balance through flexible work arrangements and parental leave policies, alongside initiatives aimed at reducing the burden of domestic responsibilities. The true empowerment of women in India hinges on bridging the gap between academic achievement and professional engagement in STEM fields ensuring women’s active and sustained participation in these sectors.

Jyoti Thakur is an associate fellow at the National Council of Applied Economic Research, Delhi, Views are personal.

Instead of debating the cause of the fall and the rise in the proportion of women farmers and family helpers, we should look to expand women’s opportunities outside of agriculture, which are better paying.

Arguably, the debate around trends in Indian women’s employment is only outclassed by a similar one regarding trends in poverty. Unfortunately, the scrutiny of the measurement of poverty is not matched by similarly close attention to the measurement of employment.

The broad contours of the debate, mainly relying on data from the National Sample Surveys (NSS) and Periodic Labour Force Surveys (PLFS), are the following: the work participation rate for women ages 15 and above fluctuated around 42% between 1993-94 and 2004-05, declined to 28% in 2011-12, and plummeted to 22% in 2017-18. From 2017, it miraculously surged, and reached 36% in 2022-23.

Two contrasting narratives

In an era of heightened politicisation of statistics, these observations became a ping- pong between pessimists and optimists. The pessimistic story explained the decline in women’s work participation as a sign of declining job availability and later increase as a sign of poverty. The optimistic story painted the initial decline as a sign of growing prosperity, allowing women to focus on their families, and the surge as a sign of increasing job opportunities. Others have tried to see this as a natural transformation of the economy chronicled by Claudia Goldin’s famous U-shaped curve where women are displaced from the labour market as the agricultural workforce moves to industrial employment, with female employment rebounding with the service economy again making space for them.

We must examine the foundation of these narratives. We see a striking trend when we break down the 25-59-year-old women’s work participation into three categories: self-employment in agriculture, self-employment in other activities, mainly in petty manufacturing or shopkeeping, and wage and salaried work in manual or white-collarwork.

Women’s work on family farms dropped from 23% to 10% between 1993 and 2017. During the era of increasing employment, the work on family farms bounced back to 23%, thus more than doubling in the last five years. Wage labour and self-employment in non-farm work remained more or less steady at 14-16% and 5-6%, respectively, although we see a slight upward trend in wage employment in recent years. So, most of the changes are driven by the ebbing and flowing tide of women’s work on family farms.

But questions about principal and subsidiary activity status are alien for rural women whose day is full of demands for bathing and feeding children, fetching water, washing cattle, harvesting grains, and making pickles for sale. The interviewer’s job is to provide context and ask questions that elicit information about the key indicators of interest. For example, a study by the National Council of Applied Economic Research traced the impact of question-wording on women’s work participation rate. Women’s work participation was initially measured using NSS-style questions and later through probing questions. This increased the rural women’s work participation rate from 28% to 44% for the same women. Most of the omissions were of women who were self-employed in agriculture and animal care.

Historically, these challenges were addressed by relying on trained and experienced field investigators who learned to interpret their questions, keeping local conditions in mind. However, India’s once-vaunted statistical system has been in crisis. As Pramit Bhattacharya noted, until the late 1990s, interviewers were regular employees recruited locally. Since then, supervisors have been centrally recruited and often posted in areas they may not be familiar with, and interviewers are short-term contractual workers hired locally. This has led to a steep decline in quality, culminating in the government disputing the quality of the NSS consumption expenditure survey in 2017-18. A recognition of the declining quality of NSS surveys may have led to increasing attention to data quality, as evidenced by the increase in the strength of subordinate statistical services from 2,181 officers in 2009-10 to 3,121 in 2019-20. This suggests that increased attention to capturing women’s work on family farms rather than an actual increase in farm work accounts for the doubling of women farmers over a short period of five years.

The counterargument

A counterargument might be that this increase is due to economic shifts, particularly men’s movement out of agriculture, creating space for women. Yet, a modest decline in male self-employment in farming, from 33% to 25%, occurred between 2004-05 and 2017- 18, when the female work participation rate also declined. Since then, the proportion of men classified as farmers/family helpers has increased slightly, accompanied by a much more significant increase for women. Instead of debating the cause of the fall and the rise in the proportion of women farmers and family helpers, attention needs to focus on the relative stagnation in the proportion of women who are wage workers (around 16%) and owners/family helpers of small businesses (around 6%) and seek to expand women’s opportunities outside of agriculture, which is generally better paying.

Sonalde Desai is Professor at the National Council of Applied Economic Research (NCAER); Pallavi Choudhuri is Senior Fellow at NCAER. Views are personal

Janani Suraksha Yojana, launched in 2005, has helped reduce maternal and neonatal mortality by promoting institutional delivery. But the utilisation of antenatal care has been low.

Creating government programmes to incentivise desired behaviour has a long history in development planning. Unfortunately we have no guidance on when success can be celebrated and the programmes be restructured or allowed to sunset. Janani Suraksha Yojana provides an interesting illustration.

It was instituted in 2005 to encourage hospital delivery through financial incentives. Two types of incentives were provided — payment to new mothers to help defray hospital delivery costs and payment to local health workers to guide women in negotiating access to hospital admission.

This programme has shown remarkable success, with more than 88 per cent deliveries taking place in a hospital. Is it still necessary to continue this programme to avoid backsliding?

JSY is a Centrally sponsored safe motherhood intervention programme that was introduced in 2005 to reduce maternal and neonatal mortality by promoting institutional delivery among poor pregnant women, especially those from Scheduled Castes, Scheduled Tribes, and BPL households. It has been implemented in all States and Union Territories, with a special focus on low-performing States (mainly in north India and north-east).

An expecting mother gets ₹1,400 in rural areas and ₹1,000 in urban areas after delivering at a public health facility or in an Accredited Private Hospital. While SC/ST women get the cash incentive in both low and high-performing States, only women from BPL households get the benefit in high-performing States.

Delivery in hospitals

Institutional delivery has increased from 39 per cent during 2005-06 to 89 per cent in 2019-21. Interestingly, this increase has occurred for both high- and low-performing States and even for women having a third or later children in high-performing States who are not eligible for the benefit.

This suggests that a climate encouraging hospital delivery has been created. At the same time, the cost for hospital delivery has risen sharply, reducing the importance of JSY incentives in overall expenditure.

The National Family Health Survey (2019-21) reported that the average out-of-pocket cost of hospitalisation delivery was ₹10,035 (₹24,663 in private and ₹3,245 in public facilities), far more than the ₹1,400 and ₹1,000 incentive.

This begs the question, is it time to allow the programme to sunset? Or at least be restructured to focus on elements of maternal care that have not shown improvement? Though there was a tremendous rise in hospital delivery, limited progress was noted in the uptake of ANC (antenatal) care. Pregnant women who went for at least three ANC visits got two TT injections, and consumed iron folic acid tablets/syrup for at least 100 days increased from 9.3 per cent to 25.7 per cent between 2005-06 and 2019-21. Moreover, there remains a huge gap in the utilisation of ANC care across different population groups. Low utilisation of ANC care is still a major concern among the poor, and SC/ST women and for higher-order births.

Therefore, it would be worth focusing on the pre- and post-delivery components of maternal health now to achieve the broad goal of improvement in maternal and child death.

Alternatively, some refinement of the programme can be undertaken to address disparities within a State. Even in some of the so-called “low-performing States” some districts have hospital delivery rates of over 96 per cent (example, Hamirpur or Mahoba in UP) while some of the districts in high-performing States continue to have low utilisation — example, Mewat in Haryana has 74.6 per cent hospital delivery rate. Within States, resource transfer to encourage hospital delivery in low-performing districts may improve programme coverage without much political cost.

Just as we evaluate and restructure programmes that perform poorly, it is important to periodically evaluate successful programmes to ensure that the funds and health worker efforts are utilised to provide the greatest benefit for the programme expenditure.

Barik is Fellow, NCAER and Desai is Professor, NCAER