From 1993-94 to 2004-05 the poverty ratio declined 14% (from 57.24% to 43.06%), compared to an 8% decline in India as a whole and a less than 2.5% decline in Orissa (which has now surpassed Bihar as the state with the highest headcount ratio of 47.76%). Even more surprising, the headcount ratio of the very poor halved in Bihar from 28.29% to 14.65% compared to a 5.74% decrease in India and an actual increase in Orissa (from S. Mahendra Dev and C. Ravi, 2007. These figures are from the 61st round of the NSS and are for united Bihar). While this improvement was from a very low base, it is still surprising given the dismal condition of public institutions and the lack of investment in the state during this period. A combination of higher wages for agricultural laborers and remittances from an increasing number of migrants, many of whom experienced increased labor mobility as traditional patron-client relations and bonded-labor ties broke down, explains this surprising decline in poverty.[thanks, prof.swarup]
There is, in fact, a fundamental tension between lower caste empowerment and state directed development. The key levels of the bureaucracy and the police have long been controlled by people from upper caste backgrounds in Bihar and this control served to reinforce the domination of upper caste landlords in the countryside. In 2002, for example, out of a total of 244 Bihar cadre officers of the elite Indian Admistrative Service, 135 were from upper caste groups, while only seven officers came from the three largest backward caste groups (based on my approximate data). The political assertion of lower castes from the early 1990s resulted in a deep-seated conflict between a new lower caste political leadership and a largely upper caste bureaucracy, police, and judiciary. This is why the politics of caste empowerment resulted in a general breakdown of public institutions in Bihar. Since upper caste control of these institutions had reinforced structural inequalities, however, this also explains why the poor did better than we might expect despite the RJDs government's dismal development record.
save the lower castes from the state
i've always believed that the state can't save the lower castes. a state-run economy is the worst thing that could have happened to the lower castes after independence. because the state had always been a pain in several tender parts of the collective body of these castes since the beginning of..caste. a modern state with modern technological capabilities: india's socialists didn't/don't realize how much more painful it could be. roads, telecommunications, motorized transport bring the lower caste individual cowering in the furthest corner of the country so much closer to the state. the best modern government for the lower castes would have been one that ensured that every individual among them got definite access to something that his/her forefathers had always been deprived of: good education. and socialist india tried to do everything but that. this article, reinforcing my beliefs, tells you how the lower castes in one indian state had actually prospered because the state had declined: