Budget 2025: Did Bihar Get Special Attention or Just Political Signaling?
Moneylife Digital Team 01 February 2025
The focus on Bihar was so intense in Union finance minister (FM) Nirmala Sitharaman's Budget speech that social media, particularly X (formerly Twitter), erupted with memes. Some even went to the extent of calling it the 'Bihar Budget' rather than the Indian Budget. So, the question arises—did Bihar genuinely receive something extra, or was the frequent mention of the state merely a strategic political signal?
 
As Bihar heads into Assembly elections this year, expectations from the Union Budget were naturally high. And, as it turns out, the Budget did have several significant announcements for the state. From a makhana Board to a greenfield airport in Bihta, Bihar found itself at the centre of key budgetary allocations. Farmers, too, were promised special provisions.
 
Here is a look at the top-5 big announcements for Bihar in Budget 2025:
1. Establishment of Makhana Board
The Union government has announced the formation of a Makhana Board to enhance the production, processing, value addition, and marketing of makhana (fox nuts). It will also work to ensure they receive the benefits of all relevant government schemes. Farmers and stakeholders involved in makhana cultivation will be organised under Farmer Producer Organisations (FPOs) to streamline operations and boost profitability. The initiative aims to benefit makhana processing companies and expand market opportunities. The Bihar government has been actively promoting makhana as a staple in Indian diets and with the establishment of this board, modern machinery will be introduced to improve both production and processing efficiency.
 
2. Greenfield Airport in Bihta
In a major infrastructure push, FM Sitharaman announced the construction of a greenfield airport in Bihar. Additionally, plans have been unveiled to expand Patna Airport to accommodate rising passenger traffic and an additional brownfield airport at Bihta, Bihar.
 
A greenfield airport refers to an entirely new airport built on undeveloped land, without any prior infrastructure. Such projects are typically undertaken to ease congestion at existing airports and enhance regional connectivity. Given Patna Airport's increasing footfall and operational constraints, the new airports are expected to significantly improve air travel facilities in Bihar.
 
3. Support for Food Processing
Under the Union government's 'Purvodaya' initiative to develop Eastern India, a National Institute of Food Technology, Entrepreneurship and Management will be established in Bihar. This institute will act as a major boost for food processing activities across the region.
 
The expected benefits include:
  • Increased income for farmers through value addition to their agricultural produce.
  • Enhanced skilling, entrepreneurship, and employment opportunities for the youth in the food processing sector.
  • This move aligns with the government's vision of strengthening food-related industries and improving agribusiness prospects in Bihar and beyond.
 
4. Western Koshi Canal Project in Mithilanchal
The Western Koshi Canal Extension, Renovation, and Modernisation (ERM) Project will receive financial support, benefiting thousands of farmers across the Mithilanchal region. This project will help improve irrigation facilities for over 50,000 hectares of agricultural land, ensuring better water management and increased productivity. Given Bihar's dependence on agriculture, this investment is expected to strengthen the rural economy and improve farmers' livelihoods.
 
Referring to the Western Kosi Canal project in Mithilanchal, the FM said, "Financial support will be provided for the Western Kosi Canal ERM project, benefiting a large number of farmers cultivating over 50,000 hectares of land in Bihar."
 
5. Expansion of IIT Patna and Other Infrastructure
The total number of students in 23 IITs across India has doubled from 65,000 to 135,000 in the past decade. To support this expansion, additional infrastructure will be developed in the five IITs established after 2014, facilitating education for 6,500 more students.
 
For IIT Patna, the Budget also promises an expansion of hostel and other infrastructure facilities, addressing the growing demand for high-quality education and research in Bihar. This initiative is expected to attract more talent to the region and contribute to Bihar's emergence as a higher education hub.
 
Bihar, Bihar Budget, Budget 25
 
Why the Announcements for Bihar Are Significant
The Budget 2025 announcements for Bihar carry political and economic significance, particularly with the state set to go to polls in November. The National Democratic Alliance (NDA) government, which includes chief minister (CM) Nitish Kumar’s Janata Dal (United), has a strong stake in Bihar, and the party remains a key ally of the Bharatiya Janata Party (BJP) at the Centre. Given this political equation, the increased focus on Bihar in the Budget was expected.
 
However, this emphasis did not go unnoticed by the Opposition parties. Congress leaders were quick to highlight the timing of the announcements, linking them to electoral considerations. Congress general secretary (communications) Jairam Ramesh remarked that while Bihar appeared to receive a ‘bonanza of announcements’ the NDA's other major ally, Telugu Desam Party (TDP) headed by Andhra Pradesh (AP) CM N Chandra Babu Naidu, had been overlooked in the Budget. This led to speculation about whether Bihar's special attention was a genuine economic push or a political manoeuvre ahead of the elections.
 
What Bihar Had Sought from the Centre
Ahead of the Budget, Bihar’s deputy CM Samrat Choudhary submitted a 32-page memorandum to FM Sitharaman, detailing the state's demands. The key requests included:
  • Rs13,000 crore for flood management in North Bihar.
  • Upgrading Darbhanga airport and constructing new airports in Rajgir and Bhagalpur.
  • Funding for Raxaul airport to boost regional connectivity.
  • Construction of 10 new Kendriya Vidyalayas (central government-run schools).
  • A 1% Gross State Domestic Product (GSDP) relaxation to allow additional borrowing.
  • Approval for a small modular nuclear reactor.
  • Development of high-speed corridors for improved transportation infrastructure.
 
In the previous Budget (2024-25), Bihar had been allocated Rs59,000 crore for road connectivity, power, and flood management. However, CM Nitish Kumar had then reiterated the demand for either special category status (SCS) or a special financial package, emphasising the need for greater central assistance to accelerate Bihar's development.
 
With these major announcements, Bihar has certainly received notable allocations in Budget 2025. However, whether these promises translate into real, on-ground development or remain political rhetoric will depend on the effective implementation and timely execution of these projects.
 
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