An Indian State Votes Its Future

With the election of reformer Nitish Kumar, voters in the poor and caste-riven Bihar signaled a desire to join the new India

By Manjeet Kripalani

On Nov. 22, Nitish Kumar, a reformer, won a resounding victory in the assembly elections in Bihar, India's poorest and most lawless state. Kumar, who is to be sworn in as chief minister Nov. 24, has been campaigning tirelessly for nearly two years, on a platform of development and education, against the incumbent, Lalu Prasad Yadav. The outgoing political strongman had urged people to vote according to their caste.

It's a breathtaking moment for India. All of India had written off Bihar, a state in the east of India that has no religious problems, but where violence between the upper and lower castes has dominated the debate. In Bihar, went the old saw, people didn't cast their vote, they voted their caste. Indians joked that if Pakistan wanted Kashmir, they could only have it if they took Bihar as well, ridding India of its real scourge and GDP downer.


  No longer. Biharis voted for economic development and rejected the candidate who had ruled the state on the basis of caste for 15 years. The meaning is clear: Bihar aspires to be like Bangalore, India's tech capital. That brings Bihar into the mainstream of the new India.

Bihar has much to contribute to India. It's one of India's most endowed states in terms of natural resources -- coal and minerals. Because there are no jobs in Bihar, its people migrate to other parts of India, and they bring back tales of development -- of electricity, of education (see BW, 03/21/05, "Welcome to Old India").

Biharis are mostly farmers, but they want to be more -- and they realize that education is the way out of poverty. So they're increasingly pursuing education as a means to fulfill their aspirations. The fastest-growing informal industry in Bihar is primary education. There are private schools everywhere, under trees, in parlors, in village corners.

Biharis sit for competitive exams such as the Indian Administrative Service en masse -- and qualify -- so many of India's top administrators are from Bihar. Rickshaw drivers' sons battle to sit for the tough, prestigious IIT (Indian Institute of Technology) entrance exams -- and they make it.


  This is the mood that Kumar, an engineer, tapped into. This, and the combination of an outstanding, incorruptible Election Commission -- allowed to do its job in Bihar for the first time -- led to Bihar's first free and fair election. Unafraid to come to the polls, people turned out in huge numbers, and voted for their future.

The signal coming from Bihar will affect every state in India. Certainly, the state, which has suffered from a lack of attention during the past 15 years, will emerge a stronger place. India has seen this kind of change before, in the southeastern state of Andhra Pradesh.

In the early 1990s, Andhra Pradesh ranked among India's poorest states. But when an unknown candidate, Chandrababu Naidu, won the state elections, he focused on using technology -- and especially the state capital Hyderabad's proximity to Bangalore -- to pull Andhra Pradesh out of poverty.


  Now, Hyderabad and Bangalore are two of India's cities most identified with high-tech, and Andhra Pradesh has seen tremendous development (see BW Online, 07/29/05, "A Brain Trust in Bangalore").

Apart from the psychological impact of not having Bihar be a drag on India, the country could see enormous results from the state's economic integration into the mainstream.

For instance, much of India's coal is in Bihar and neighbouring Orissa. If the state government gets its act together, it could make the coal mines efficient. This could enable Bihar to be the center for Indian power generation, with the construction of power plants around the coal pits.


  This would save on transportation costs and distribute the power through the grid to the rest of the country. Such development will help solve much of India's power constraints -- and boost business (see BW, 10/06/03, "India: Getting Power to the People").

With this election, the mood of optimism in India has jumped up two notches.

Kripalani is BusinessWeek's India bureau chief, based in Bombay

Edited by Phil Mintz

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