NEW DELHI: The Annual Plan for Bihar for the year 2006-07 was on Saturday finalised at Rs 8,250 crores at a meeting between the Planning Commission Deputy Chairman, Montek Singh Ahluwalia, and the State chief minister, Nitish Kumar. The outlay includes an additional Central assistance amounting to Rs 50 crores for priority schemes of the State.

During the discussions, Dr. Ahluwalia pointed out that the Prime Minister, Manmohan Singh, was keen on expediting the development of Bihar and had directed the Commission to put in special efforts. For this purpose, he said a team of Planning Commission experts would be visiting the State shortly for an on-the-spot assessment of its problems to evolve the means for speedy remedial measures. The Commission, he said, would request the Finance Ministry to enhance Bihar's borrowing limit as a special case in the wake of huge gaps in its infrastructure.

The State, Dr. Ahluwalia said, was likely to get an increased flow of funds for the new programmes announced by the Centre for improving infrastructure and rejuvenating economic activities in its rural and backward areas. The need, he said, was to ensure better and timely completion of these programmes while schemes such as Bharat Nirman, rural roads development, backward region grant fund and employment guarantee programme would also help the State in accelerating development and improving rural the economy.

The Commission lauded the State Government for major initiatives, including administrative reforms, decentralisation and simplification of procedures, delegation of powers and action taken to implement mission mode programmes launched by the Centre on priority for Bihar's development. The initiative to extend employment guarantee programme to all districts was also appreciated. The State was asked to prepare a road map for long-term development of the power sector and attention was drawn to the large number of villages and households yet to be electrified.

The Chief Minister, while thanking the Centre for the cooperation being extended in rebuilding Bihar, said the State Government was planning to introduce the Fiscal Responsibility and Budget Management (FRBM) Act through an Ordinance to bring down the revenue deficit to zero and fiscal deficit to three per cent. As for power sector reforms, Mr Kumar said that the regulatory commission had already been set up and Bihar State Electricity Board unbundled into six companies.

New initiatives aimed at increasing revenue, he said, included introduction of new excise policy, rationalisation of VAT and entertainment tax and new transport policy. Reforms aimed at attracting investment included fast track clearance through State Investment Promotion Board and incentive packages for sugar industry, technical education, health care and hospitality, he said.

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