70^th BPSC Mains

Approach Briefly discuss Bihar Agri-Investment Promotion Policy, 2020. Highlight the objectives of the Bihar Agri-Investment Promotion Policy, 2020. Conclude suitably.

Introduction

The Bihar Agri-Investment Promotion Policy (BAIPP), 2020 aims to boost agri-based entrepreneurship, value addition, and post-harvest infrastructure. It promotes private investment and inclusive rural development through targeted incentives. Around 80% of Bihar’s population is engaged in agriculture, making it a key agri-state in India.

Body

• Promotion of Agro-Based Industries in Key Sectors:
  • The policy focuses on seven priority sectors: makhana, honey, fruits & vegetables, maize, seeds, medicinal and aromatic plants, and tea.
  • These sectors were identified for their comparative advantage in Bihar’s agri-climatic context and untapped processing potential.
• Provision of Capital Subsidy for Investment Support:
  • Eligible investors receive 15% capital subsidy on the project cost, with 25% subsidy for Farmer Producer Companies (FPCs).
  • An additional 5% subsidy is provided to SC, ST, and EBC entrepreneurs, and 2% more for women, differently abled, and other vulnerable groups.
• Encouragement of Inclusive Entrepreneurship Models:
  • Units can be established under Proprietorship, Partnership, LLP, Company, or Farmer Producer Company formats.
  • This flexibility ensures broad-based participation including individual farmers, rural entrepreneurs, and farmer collectives.
• Support for Modernization and Expansion of Existing Units:
  • Existing processing units are eligible if capacity is increased by at least 25% through modernization or diversification.
  • This promotes technological upgradation and competitiveness in Bihar’s agro-processing sector.
• Defined Investment Threshold and Credit Linkage:
  • The minimum eligible project cost is ₹25 lakh, and the maximum is ₹5 crore.
  • The policy mandates that at least 20% of the project cost must be financed through a term loan from a recognized financial institution, ensuring credit discipline and viability.
• Non-Overlapping with Other Industrial Policies:
  • While investors can avail benefits under both BAIPP and Bihar Industrial Investment Promotion Policy (BIIPP) 2016, overlapping incentives are disallowed to maintain fiscal discipline.
• Institutional Support and Implementation:
  • The Bihar Horticulture Development Society (BHDS) is the nodal agency for policy implementation, monitoring, and disbursement.
  • It provides project facilitation, technical guidance, and ensures transparent policy delivery at the grassroots.
• Linkages with Other Subsidy Schemes:
  • Investors can avail grants, soft loans, and other subsidies under various government schemes, with an overall cap on maximum benefits.

Conclusion

The BAIPP 2020 provides a comprehensive framework to catalyze private investment, encourage agri-entrepreneurship, and promote value addition in key sectors. By combining financial incentives, institutional facilitation, and inclusive targeting, the policy is expected to enhance rural incomes, reduce agri-waste, and position Bihar as an emerging hub of agro-based industrial growth.