The Nitish Brand: Why India Inc. is not afraid of

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The Nitish Brand: Why India Inc. is not afraid of 'Jungle Raj' in Bihar

The killings

  • In the last week of December, two engineers were shot dead in the Darbhanga district of Bihar
  • Within 72 hours, there were two more murders
  • The state's opposition claims this signals a return to the infamous 'jungle raj'

The impact

  • Business entities are not overly concerned about the security situation
  • They believe that Nitish can control law and order in the state

More in the story

  • What are the thoughts of the company which lost two engineers?
  • What Lalu is doing to try and change his image

After becoming Chief Minister of Bihar for the first time in 2005, Nitish Kumar had declared: "Gone are the days when people of Bihar moved in their vehicles with a gun barrel pointing outside the windows."

He was obviously referring to Lalu Prasad and Rabri Devi's 15-year reign, which many had branded as 'jungle raj'.

Since then, Nitish has made every effort to persuade people that the rule of law is here to stay. And it's not just the common people who've bought in to this, it's also the investors into the state's economy.

Also read - Nitish's clock is ticking: has Jungle Raj returned to Bihar?

Many analysts, as well as political opponents, had predicted the return of 'jungle raj' if Nitish was voted back into power with Lalu's support.

But their landslide victory proved that people were hopeful, and within 48 hours of the results on 8 November, two major foreign direct investments were announced. The US multinational General Electric (GE) was awarded a Rs 14,656 crore contract by the Indian Railways to set up a diesel locomotive factory at Marhowra, 81 kilometres from state capital Patna. In addition, French firm Alstom announced the commencement of work on a Rs 20,000 crore electric locomotive plant at Madhepura.

Murders haunt the state again

The first major challenge to people's belief that 'jungle raj' was a thing of the past came in the last week of December.

Two engineers, Mukesh Kumar Singh and Brajesh Kumar Singh, who were working on the Rs 750 crore State Highway 88 (Begusarai-Darbhanga) project for the BSC-C&C, were shot dead near Darbhanga.

Within 72 hours, there were two more incidents that shook the state. A Reliance engineer was gunned down in the Vaishali district while NTPC supervisor Naval Kushwaha was murdered in Bhagalpur.

Four murders in 72 hours in December made people fear that jungle raj was back to haunt Bihar

Such headlines had become a thing of the past in Bihar. Therefore, it was no surprise that the opposition said these incidents were a vindication of their pre-poll claims. The clamour of 'jungle raj returns' is growing, and senior leaders are pointing fingers at the ruling alliance.

Former deputy CM Sushil Kumar Modi believes the "old days" are back in Bihar.

"The rising incidents of crime are hurting the image of Bihar in India and abroad. Nitish Kumar must answer how the state would progress in such a situation. Who would the investors trust for security of their projects?" he asks.

Concerns exist, but not big ones

There is no doubt that the corporate sector has its doubts, but not many industrialists are willing to believe the worst.

BSC-C&C has stopped work on State Highway 88, citing security reasons. However, it has no plans to shift operations outside Bihar. It is a joint venture company, which has been active in the state for almost a decade.

"We have so far completed 14 projects in Bihar. The company is involved in 12 other projects. Out of these, three are build-operate-transfer (BOT) model ventures. We shall be looking after these projects for the next 15 years," says Ashok Kumar, vice-president of BSC-C&C.

The company has completed undertakings worth Rs 5,200 crore in the state. It is currently working on projects worth Rs 2,500 crore. It has also placed bids on two new road construction projects worth around Rs 1,326 crore in Bakhtiarpur and Jainagar.

Also read - Yes Lalu is back. But let's not worry about jungle raj

Kumar has apprehensions regarding the political constituents of the current dispensation (read: Lalu's RJD). However, he is not overly worried. "We have security concerns. But our faith in the leadership of Nitish Kumar is still intact," he says.

Obviously, Kumar's faith is bolstered by the Chief Minister's track record. The way Nitish has rapped the official machinery on its knuckles after the recent killings, has only augmented this trust.

He talks about how the Nitish government had provided special security to all the site and project managers working on the East-West corridor in 2005-06. Later, the security cover was lifted, as the law-and-order situation improved.

Kumar adds: "We will only believe that 'jungle raj' has returned when goons and mafia start getting political patronage."

In any case, Bihar is not the only state where construction companies work under the shadow of the gun.

"Many big companies in South India 'manage' local goons with money. Most companies have separate unofficial funds for this purpose. This is not a new practice in the construction business," says a top official of a construction company, on the condition of anonymity.

Govt wary of its image

The infrastructure sector is pivotal to Nitish's developmental plans. While the manufacturing sector in Bihar grew by 45.4% during his first term (2005-2010), the construction sector witnessed a record growth of 19.8%.

Aiming to maintain this momentum, Nitish has made law-and-order his primary focus in his present tenure. The first thing he did after taking oath was to convene a meeting to review the state of crime in Bihar. He had issued clear instructions during the meeting to 'deal firmly with those who want to spoil the atmosphere of the state'.

Lalu realises the need to dispel concerns. He stressed that the govt would uphold the rule of law

The Chief Minister reportedly took to task many senior police officials after the Darbhanga killings. This has made the priorities of his government clear.

The ruling alliance also took measures to control the political damage. Just a day after the Darbhanga incident, Lalu issued a statement to dispel any misgivings. Stressing that the present government would uphold the rule of law, he proclaimed: "The state government has rolled up its sleeves against crime. Nobody in the state needs to fear anti-social elements."

Petty crime or jungle raj?

Former IB official Prabhat Singh is now associated with a private security business in Patna. He had hoped the demand for private security guards would increase after the formation of the Mahagathbandhan government. However, Singh has not seen any extraordinary boom in his business during the past one-and-a half months.

"One can say our profits are directly related to 'jungle raj'. But our business is stagnant, which suggests that it's not yet staging a comeback in Bihar," he says.

Lalu seems to have learnt his lessons from the past. He is particularly keen on improving his image this time around.

According to Singh: "Lalu faces a big challenge to wash his hands of the stigma of 'jungle raj'. This the reason he is making all these politically-correct noises. Bihar is not really worried about the return of jungle raj. The primary concern is to take the development process to the next level."

No stopping development

FDI projects worth around Rs 35,000 crore have been announced in Bihar since the new government assumed charge. Bihar Industries Association president Ram Lal Khaitan is confident these plans will be implemented on the ground.

"Investors still trust Nitish Kumar. The business environment in the state is improving. Incidents of crime raise some doubts, but every state has to deal with them," Khaitan says.

On whether the recent killings have adversely affected the investment climate in Bihar, Khaitan says: "Most investors are not worried about the security of their assets. They do not think that the business climate is deteriorating."

Tourism is another sector that is directly affected by the law-and-order situation. It grew by a healthy rate of 17.3% between 2010-11 and 2013-14. The number of domestic tourists visiting Bihar increased from 1.65 crore in 2010-11 to nearly 2.33 crore in the year 2014-15.

The same trend was witnessed across almost all other sectors. In fact, Bihar's gross state domestic product (GSDP) was at US $66.4 billion in 2014-15, making it the fastest growing state in the country.

Growth is also trickling down to the grassroots. The per capita income of Bihar was Rs 10,635 in 2009-10. It went up to Rs 15,650 in 2013-14.

The government is promoting the 'Aao Bihar' (Come to Bihar) policy to improve business opportunities in the state. The policy is aimed at encouraging people to willingly give land for industrial projects.

BSC-C&C, the firm that lost two engineers, still has faith in Nitish's promise of law and order

"The government has instructed police and all the other concerned departments to give priority to land disputes," says a senior official of the Bihar Industrial Area Development Authority (BIADA).

Nitish is well aware of the political sensitivity attached to the law-and-order situation in the state. He has personally admitted to the pressure to perform after the 2015 mandate.

Ashok Kumar sums it up best. "'Jungle raj' is a catchy phrase. But there is nothing of the sort in Bihar. The way this government has dealt with recent incidents has left no doubt that it is sensitive to people's worries. Nitish has been successful in conveying to the corporate sector that the mafia will not get patronage under his rule."

More in Catch - Banka Silk founder Udayan Singh wants a third term for Nitish

Here's why Lalu-Rabri era is known as jungle-raj in Bihar

Abhishek Parashar

Abhishek Parashar @abhishekiimc