Bihar Rural Roads Project
BUILDING ALL-WEATHER ROADS TO INCREASE CONNECTIVITY AND IMPROVE RURAL LIVELIHOODS
Located in eastern India, Bihar is the third most populous state in the country. It has a strong agricultural base, with the vast majority of its 104 million residents living in rural areas and relying on agriculture for their livelihoods. Despite the high economic growth witnessed in recent years, Bihar has one of the lowest levels of per capita GDP in India, which remains less than 40% of the national average. There is considerable disparity in the per-capita income across the districts of Bihar, which is often attributed to the pronounced gap in rural road development. It is within this context that the Government of Bihar aims to improve local connectivity and in doing so facilitate socio-economic development.

In 2018, NDB approved a loan of USD 350 million to the Government of India, for on-lending to the Government of Bihar, to finance the Bihar rural roads project. The total project cost is USD 500 million, the balance of which – USD 150 million – is provided by the state government. The project will contribute to the state government’s ongoing efforts to provide all-weather road connectivity to rural habitations with a population between 250 and 499, which is meant to complement the central government’s rural connectivity programme whose focus is primarily on habitations with a population of more than 500.

Through this project, NDB will help the Government of Bihar enhance local connectivity and improve the state’s transportation infrastructure by constructing and upgrading about 4,000 km of rural roads, providing all-weather connectivity to around 3,400 rural habitations spreading across 26 districts. By expanding and upgrading rural road networks, the project is expected to increase transport efficiency and improve access to local socio-economic centres for a large number of rural communities, some of which have been isolated for long periods. It is expected that these outcomes will enhance agricultural productivity and increase household income, leading to improved rural livelihoods in the state of Bihar.