For Industrial development in Bihar, Diagnostic study to ascertain present status.
Finding constraints/barriers in development of Industrial sector
Identifying potential areas like agro, food, dairy, textiles & handicrafts leather that show maximum potential for intervention.
Assessing the infrastructure needs of Industrial sector.
Preparing a strategy for holistic development of sectors with focus on cluster approach and on increasing the income level of farmers / artisans
Identifying and assessing the technical & economical feasibility of setting up Industries.
Preparing and identifying feasible 'business models' in context of the various sectors identified
Lean: From Theory to Practice — One City’s (and Library’s) Lean Story… Abridged
Resource mapping of Bihar
1. RESOURCE MAPPING OF BIHAR
&
STRATEGIC ACTION PLAN FOR DEVELOPMENT
Prepared Jointly By :
Gherzi Eastern Ltd.
&
Genesis Fintec Ltd.
2. RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
Gherzi - Genesis
BACKGROUND & OBJECTIVES
FLOWCHART OF OVERALL STRATEGY
- Facilitating Business & related Infrastructure
- Strengthening & Installing support systems
A. Facilitating Business & related Infrastructure
1. Potential sectors identified
2. Sub Sector /Industry wise info
3. Summary of parks & RBHs
B. Strengthening & Installing support systems
Enable & facilitate
- Infrastructure Development
- Financial Network
Strengthen
- Research & Capacity Building
Install
- Policy Initiatives suggested
- Project Implementation mechanism
CONCLUSION
I Map
II Current Situation
III Strategic Solution
IV Business Models
3. Gherzi - Genesis
Sectoral Composition of GSDP
48.78 40.85 42.00
9.92
12.08 9.02
41.29 47.06 48.98
0%
20%
40%
60%
80%
100%
1993-94 1999-2000 2004-05
Tertiary
Secondary
Primary
Over the decade, the share of secondary sector has remained at a level of 9%
• With the registered manufacturing having become a small sub-sector yielding a larger share to the
construction activities
• negative growth rate in manufacturing
The increase in tertiary sector share reveals that the economy is witnessing a process of tertiarisation
much before a process of industrialisation
Background
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
4. Gherzi - Genesis
Objective of the study
So a comprehensive development strategy for the development of Bihar is called for and
would require a ‘multidimensional approach across sectors’
So the major challenges sought to be addressed through this study are to:
Provide Linkage for Farm & Non-farm produce with industry /
business to ensure that rural masses & artisans are economically
empowered
Add Value to the primary produce within the state so that the
secondary sector grows and the economy of the state develops
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
5. Identify major
resources & bring in
anchor industries as
prime movers
Create a higher no. of
smaller oases (RBH)
to facilitate linkages
into the rural
hinterland
(RBH - PPPP model)
Create a few oases
of competence /
Parks as Hubs
(PPP model)
Gherzi - Genesis
OVERALL STRATEGY
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
6. Creation of
core
Infrastructure
Enable & facilitate
Research
Strengthen Institutions & Resources (Public sector &
PPP model)
Credit flow into
identified sectors
Capacity
building
Project
implementation
mechanism
Pragmatic
Policy
Install
Gherzi - Genesis
OVERALL STRATEGY
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
7. Fruits & Vegetables
Cereals & Pulses
Spices
Potato
Makhana
Herbal & medicinal
Plants
Jute
Sugarcane
RESOURCE GROUP ACTIVITY & SPECIFIC
RESOURCES
INDUSTRY SEGMENT FOR
RESOURCE UTILIZATION/
REVITALISATION
Milch Cattle & Dairy
Farming activity
Bees & Orchards,
Apiary activity
Gherzi - Genesis
Water bodies / rivers
& fishery skills
Agriculture
& Horticulture Agro & Food
Processing Industry
Herbal Medicine &
Aromatic Industry
Jute Industry
Sugar Industry
Animal Husbandry
& Allied Sector
Milk Processing
Honey
Fisheries
POTENTIAL SECTORS IDENTIFIED
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
8. Poultry Farming &
Animals Rearing
Animal Hides
RESOURCE GROUP ACTIVITY & SPECIFIC
RESOURCES
INDUSTRY SEGMENT FOR
RESOURCE UTILIZATION/
REVITALISATION
Gherzi - Genesisc
Handicraft Skills
Handloom Weavers
& Looms
Limestone
Steel scrap, Sponge
Iron, Ingots & Millets
Places of Heritage,
Culture, & Religious
interests
Animal Husbandry
& Allied Sector Poultry & Meat Processing
Leather
Handicrafts
Handlooms
Handicrafts
Handlooms
Minerals Cement Industry
Steel
Mini Steel, Secondary
Steel & Castings
Tourism
Hospitality & Tourism
Industry
POTENTIAL SECTORS IDENTIFIED
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
9. Agriculture & Horticulture
Sector wise development
strategies
Fruits & Vegetables
Cereals & Pulses
Spices
Potato
Makhana
Gherzi - Genesis
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
15. Gherzi - Genesis
Food Parks under PPP Model are suggested at Hajipur (Vaishali), Purnea, Bihta (Patna) and Begusarai
Suggested supply chain model for agro & Food Processing
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
16. Gherzi - Genesis
Agriculture & Horticulture
Sector wise development
strategies
Jute
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
18. Gherzi - Genesis
RBHs earmarked for agri products are suggested for use
1 No. of Park is suggested at Purnea with backward linkage
3 No. of Jute Mills are suggested at Jute Park with backward linkages
10 No. of Processing Units for weaving are suggested at Jute Park with backward linkages
50 No. of Units for Jute Diversified Products are suggested at Jute Park with backward linkages
Current situation
Availability of raw jute: ******
Jute cultivator sells to Agents/ JCI for minimum
Price
Strategic solution
Set up a Jute Park at Purnea
Procure raw jute through RBHs (using
existing agricultural mandis in nearby districts)
No value addition in the state
Business Models Location Investment potential
(Rs Cr)
Employment potential
Jute Park Purnea 20 100
Jute Mills & Processing units Jute Park at Purnea 165 5350
Total 185 5450
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
19. Gherzi - Genesis
Animal Husbandry & Allied Sector
Sector wise development
strategies
Milch Cattle & Dairy
Farming activity
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
25. Animal Husbandry & Allied Sector
Sector wise development
strategies
Water bodies / rivers
& fishery skills
Gherzi - Genesis
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
27. Gherzi - Genesis
Aqua Park under PPP Model is suggested at Muzaffarpur & Bhagalpur
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
28. Gherzi - Genesis
Animal Husbandry & Allied Sector
Sector wise development
strategies
Poultry Farming &
Animals Rearing
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
30. Gherzi - Genesis
Suggested supply chain model for poultry & meat processing
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
31. Gherzi - Genesis
Animal Husbandry & Allied Sector
Sector wise development
strategies
Animal Hides
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
33. Gherzi - Genesis
Leather Parks under PPP Model are suggested at Muzaffarpur & Katihar
Current situation
Availability of raw hides: 36 lakh pieces
Only few private units for Primary processing at
Muzaffarpur: raw to wet blue stage
No secondary processing. Wet blue leather is
sent to Kolkata, Kanpur & Chennai for final
processing
Strategic solution
Set up leather park at Muzaffarpur and Bihta
Local units will get finished leather from the
tanneries
6003Muzaffarpur, Baruini,
Siwan
Revive leather tanning units
6600
200
5000
800
Employment
potential
2Bihta (Patna), BetiahRevive leather processing plant
Investment potential
(Rs cr)
LocationBusiness Models
125Total
100Tanneries
20Parks at Muzaffarpur &
Katihar
Processing units
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
36. Gherzi - Genesis
Suggested supply chain model for Handicrafts
Create marketing outfit for ‘
bihar brand
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
39. Gherzi - Genesis
handloom
Current situation
40000 handlooms and 90000 skilled weavers
(approx); majority of weavers have shifted to other
Profession; the weavers are unable to cope with
the market demand
No Design, Dyeing, Printing & Quality testing facilities
Or are located far beyond the reach of the weavers
Strategic solution
Cluster based CFC to be developed by involving
NGOs like ASEED, that is easily accessible to the
weavers
Thus proper market linkage, financial assistance
and access to all facilities under one roof will lead to
increased production
Business Models Location Investment potential
(Rs Cr)
Employment potential
Common Facility Centre with
market Hub
Bhagalpur, Gaya, Banka,
Madhubani, Nalanda
12 400
Revive Central Processing Plant,
Finishing Plant, Dyeing &
Cooperative Spinning Mills
Biharsarief, Darbhanga,
Bhagalpur, Pandaul, Siwan
15 2000
Total 27 2400
Common Facility Centre with market Hubs under PPP Model are suggested at:
1. Bhagalpur – Champanagar, Puraini, Tirpainti, Kharikbazar
2. Gaya – Maanpur
3. Banka 4. Madhubani 5. Nalanda - Biharsarief
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
40. Gherzi - Genesis
cement
Current situation
Bihar is a net steel importer
Currently construction steel units are operating
mainly around Patna
Raw material (coal & iron ore) for DRI/Sponge
iron plants accessible from Jharkhand/ Orissa
Strategic Solution
To target regional demands in Infrastructure
projects
Competitive advantage of skilled pool of human
resource
Plants near markets are the trends everywhere
Thrust on mild steel ingots through induction
furnace route
Prioritize production of long products
Linkage with the miners on long term basis
Business Models Location Investment
potential (Rs Cr)
Employment
potential
Pig Iron with Mini Blast Furnace route Dalkhola 20 150
Sponge Iron(DRI) Patna area 20 200
Ferro Alloy Unit Patna area 12 120
Wagon making Heavy Unit Muzaffarpur 100 600
Mini Steel Plant Patna, Vaishali, Muzaffarpur 140 1200
Mini Integrated Steel Plant 250
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
42. Gherzi - Genesis
Current Situation Strategic Solution
No holistic Plan for developing this sector Prepare Master Action Plan for
Brand building and promotion
Location specific Projects and
Related infrastructure and amenities
Form a State Tourism Promotion Board with
a Task Force to monitor implementation of
programs & projects
Create a Tourism Development Fund
Little incentive for private participation
in this sector. Not treated as a
potential revenue earning industry.
Encourage private sector to take the lead in
setting up Hotels, Restaurants, Tours, Parks &
other projects in the State.
For operations of Government run hotels,
restaurants etc, tie-up with private players where
feasible
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
43. Gherzi - Genesis
Action Points Model Relevant Sub Sector / Industry
Develop Parks Get the identified Parks developed
by Private developer (PPP model)
- Should be set up & maintained
by SPV on BOT basis
Agriculture & Horticulture:
- Fruits & Vegetables
- Cereals, Pulses, Spices, Potato
& Makhana
- Jute
Animal Husbandry/ Agriculture Allied
Sector:
- Leather
- Fisheries
Create Rural Business Hubs
(RBH) with customized
common facility centres
For the agricultural products, the
existing Infrastructure under the
erstwhile bazaar samitis can be
redesigned and redeveloped to suit
the Industry needs through Private
players (under PPPP model) and for
other sectors new Infrastructure to
be developed thorough Pvt. Players
(under PPPP model)
Agriculture & Horticulture
- Fruits & Vegetables
- Cereals, Pulses, Spices, Potato
& Makhana
- Herbal & Medicinal Plants
- Jute
Animal Husbandry/ Agriculture Allied
Sector:
- Fisheries
- Poultry Farming & Animal Rearing
Handicraft
Handloom
Enable setting up of related infrastructure
Appoint a Project Management agency to help the department in implementing the identified projects
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
44. Gherzi - Genesis
Location Type of Park/Mega
growth centre
Size
(acres)
Designated code
for this report
Remarks
Food Parks
Purnea Food Park & Terminal
market (F&V based)
100 FP-II Instead of
Madhepura
Bihta Food Park 100 FP-III Agri based
Hajipur Already proposed
Begusarai
Aqua Culture Park
Mazaffarpur Aqua Culture Park ACP 1
Bhagalpur Aqua Culture Park ACP 2
Leather Park
Mazaffarpur Leather Park LP1
Katihar Leather Park LP2
Jute park
Purnea Jute park JP1 Instead of the one
proposed at
Fobesganj / Katihar
Summary of parks and business hubs
Restructure BIADA and Restructure the existing Industrial Areas
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
45. Gherzi - Genesis
Summary of parks and business hubs
Cluster based rural
infrastructure
Proposed
Number
Location Function
Agriculture & Horticulture
Rural Business Hub for Agri &
Horti Produce
100 (as per list in
Annexure 6.7C)
Nodal point of all market linkages, extension and
capacity building activities. For all the resources falling
under the Agri & Horti group like, Cereals & Pulses,
Fruits & Vegetables, Medicinal & Aromatic Plants, Spices,
Makhana, & Jute. This hub will also be used for
products like Honey.
Animal Husbandry / Agriculture Allied Sector
Rural Business Hub for Fishery
activity
32 As per Table
12.4
Conduit for market linkages, extension activities and
capacity building of fish farmers. Will also prove to be
catalytic for fishery activity
Rural Business Hub for Poultry &
Meat
32 As per table
13.4
The hub will act as a nodal point between the poultry /
livestock farmers & processors as well as markets
Handicraft
Rural Business Hub for
Handicraft
21 As per table
15.4B & 15.4C
RBH will act as a conduit points for providing market
linkages and technical inputs to artisans
Handloom
Business Hub with CFC 8 As per table 16. This business hub with CFC will help weavers in
accessing common facilities and in creating marketing
linkages
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
47. Gherzi - Genesis
Sector Current Situation Strategic Solution
Power Huge Demand- Supply Gap,
though beginning to show
improvement
AT&C losses 70% against
national average of 40%
State Generation practically
Nil
Restore the non-functioning power stations at Barauni,
Muzaffarpur and Kosi Hydel
Industry should get Priority for power distribution .
Provide un-interrupted supply to Industrial Parks & RBHs
Invite Private sector participation for generation. Transmit
& distribute Electricity under PPP model
Provide incentives to industries with captive power
generation
Roads Road connectivity still poor in
most areas of State.
Connect all proposed Parks & Hubs with hinterland &
major towns with 2/4 lane roads on priority
Air & Rail Poor Air connectivity, except
for Patna city
Inadequate facilities for
promoting Exports
Passenger / Freight
movement within State
unreliable / uneconomical
Conduct feasibility for rejuvenating 25 old Air strips &
Feasibility for new Airports at Raxaul and Birpur. Improve
passenger amenities at Patna
Build a Air Cargo Complex at Patna.
Initiate - Fast inter-city express trains & upgraded, fast &
reliable freight movement. Take up the matter with the
concerned Ministry
Assessment of Infrastructural needs
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
48. Gherzi - Genesis
Sector Current Situation Strategic Solution
Industrial
Infrastructure
Most Industrial Estates resemble
industrial graveyards
Infrastructure/ facilities non –existent
Large portions of land locked in Units
closed down
Substantial vacant land in Estates
lying un- utilized
Prepare an overall Restructuring Plan
Restructure working of BIADA
Hand over O&M of Estates to private players
under PPP model
Conduct viability study of sick / closed units and
Unlock / Recycle land held by unviable Industrial Units
Develop contiguous portions of vacant land in PPP
model as specialized Parks through private developers
IT Connectivity
Exploitation by middlemen due to lack
of knowledge & information amongst
rural farmers
Information flow for State
Administration very poor
Connect identified Rural Business Hubs / Clusters
through IT backbone on priority under ‘Common
Service Centers’ scheme
Establish therein e- kiosks or Gyan Chaupals
under PPP model
Set up SWAN (State Wide Area Network) For
state level connectivity under PPP model
Assessment of Infrastructural needs
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
49. Gherzi - Genesis
Institutions Current Situation Strategic Solution
Central Financial
Institutions/
Banks
Poor Recovery & CD ratio
track record
Set up Special Cell to co-ordinate & monitor implementation of
resolutions
Cell to monitor and ensure. Time bound Action from Banks for
Innovative models of lending, to increase credit flow
Special packages for specific sectors
Special focus for MSMEs
Liberal margin/ security norms
Lack of focus &
cohesiveness between
Institutions & State
Requirements of private
sector in Bihar not being
understood by Banks/
Institutions
Rural segment not being
reached effectively
Fund SHGs through micro-finance.
Involve NGOs for capacity building
State Financial
Institutions
All State Financial
Institutions are defunct
Restructuring Plan by professionals with an objective to :
Merger of entities
Rationalization by closing / merging unviable branches
Increasing fee based activities like consultancy services
for improving bottom line
Appoint competent professionals for administration &
credit appraisals
Adopting an overall need based and customer friendly
approach
Paucity of Funds to
participate in Industrial
Revival
Create initial corpus through state intervention or public issue /
private placements,
Tie-up with Commercial Banks for consortium lending and
refinancing
Financial
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
50. Gherzi - Genesis
Action Points Model Relevant Sub Sector / Industry
Set up Research &
Development Institution
Set up under Public Sector
Agriculture & Allied
Handloom
Handicraft
Rejuvenate & set up Testing
labs & Quality control
Operations on franchise basis
through graduates
Appoint Inspection &
Monitoring Agency
Involving NGOs
Organising SHGs / setting up
co-operatives
Involving NGOs
Extension services / Capacity
building & Training
NGOs / graduates to be involved on
franchise basis
Rejuvenate & set up Seeds
farms / nurseries / hatcheries
Set up new ones & bring existing set
ups under Joint Venture (PPP)
Agriculture & Allied
Operate Vet hospital, clinics; AI
centers
Operations on Franchise basis (under
PPP)
Animal Husbandry
Enable credit inflow NGOs – Banks linkages to be
established
Special cells to liaison with NABARD /
Banks to enable increase in outlay
Entire primary sector
Measures for Capacity Building
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
51. Gherzi - Genesis
Research & capacity Building
Simply allocating funds to ineffective delivery institutions is not likely to bear any result
The thrust should be to leverage public resources through
The participation of local communities
The ingenuity of private sector
Only then, PPP can prove to be effective
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
52. Gherzi - Genesis
Project Implementation
Set up directorate of food processing
Project management agencies for various sub sectors / Industries
Policy initiative
Capital subsidy support is very much needed for inducing any appreciable investment in
Bihar
Capital subsidy on Plant & Machinery @ 25% subject to a maximum of 100 lacs
Interest subsidy @3% on working capital
Study for revival of ailing industries
Initiatives at farm level
Encouragement of SHGs
Allowing contract farming with safeguards
Involvement of panchayats
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT
53. Gherzi - Genesis
Policy initiative
RESOURCE MAPPING OF BIHAR & STRATEGIC ACTION PLAN FOR DEVELOPMENT