Bihar’s business bet: Local entrepreneurs push to rewrite the state’s economic story

For long, Bihar has carried the baggage of being a BIMARU state, a shorthand for what went wrong in India's development story. But on the ground, a group of entrepreneurs is betting that the next chapter will look very different.

"Business in Bihar today is like investing in a company that is yet to get its IPO listed," according to Gaurav Shah, Managing Director of Banke Bihari Foods, one of eastern India's largest food processors. "You have the infrastructure, the resources, the market, and the valuation is still undervalued. This is the right time to invest."

Shah was speaking at a roundtable moderated by Shradha Sharma, Founder and CEO of YourStory, featuring Shah, Prince Ranjan of Snowball Ice Cream, and Anupam Singh of Anaisha Products and Litchica Foods. Each of them has built companies that employ thousands in a state where most workers tend to seek opportunities outside.

For them, the story of Bihar is not one of decline but of possibility—if perception can catch up with reality. "There is no law and order problem in Patna today," Shah said. "We travel freely at night. The stereotype of 'Gangs of Wasseypur' Bihar exists only in people's imagination."

From "factory of migrants" to local jobs

Ranjan, a second-generation entrepreneur, runs Raj Milk and Snowball Ice Cream, a brand familiar to households across the state. His company employs more than 2,000 people. "If you ask any citizen here, they've grown up with the flavour of Snowball," he said.

For him, the biggest satisfaction has not been market share but livelihoods. "There are hardly any opportunities here. During COVID-19, when our ice cream business was completely shut for a year, we did not fire a single worker," he added.

Singh, who left a high-paying career in Mumbai with BlackRock and ICICI Bank to return to Bihar, echoed that sentiment. "I wrote down more than 100 things I want to do for Bihar. Many of our workers had migrated to Maharashtra and South India. Now, some of them are back, working in our factory, spending festivals with their families. That is the most rewarding change."

Migration remains a divisive theme. Shah sees it as the state's strength as well as its weakness. "Bihar is a factory of people working across the country," he said. "Remittances fuel local consumption. And when workers return, they bring skills learned outside. The challenge is to channel that into reverse migration."

A state poised for a leap

Despite years of economic lag, the entrepreneurs believe Bihar is positioned for transformative growth. Shah's company mills 40,000 tons of wheat a month, making it one of eastern India's largest food processing firms. He insists that Bihar can become a hub for textiles, plywood, jute, and branded consumer products.

"Thanks to the internet and direct-to-consumer models, Bihar can create its own Amul or Mother Dairy," Shah said. "The government is offering plug-and-play textile facilities at Rs 4–6 per square foot—cheaper than anywhere else in the world."

Singh pointed to an untapped opportunity: global capability centres (GCCs). "When companies shift back offices to affordable cities, why not Muzaffarpur or Gaya? Infrastructure and land are available. This could create thousands of jobs."

The entrepreneurs also spoke of Bihar's soft power potential—through food, storytelling, and tourism. "Korean dramas and cuisine have built cultural influence worldwide," Ranjan noted. "Why can't Bihar do the same with litti chokha or its festivals? We must tell a different Bihar story."

The persistent hurdles: Floods, skills, execution

Despite the optimism, the state suffers from structural weaknesses. "Every 2–3 months, half of Bihar is underwater," Ranjan said. "Flooding displaces people and destroys productivity. With so many technologies available, how is this still unsolved?"

Skill development was another unanimous concern. Bihar has no dedicated colleges for food technologists despite hosting dozens of food processing units. "We are forced to hire from Uttar Pradesh or elsewhere," Shah said. Singh added, "Policies exist, but execution is slow. What we need is not just think-tanks but people who can implement on the ground."

Urbanisation is lopsided, too. Patna is bursting at its seams, while vast tracts of land remain underdeveloped. "Bihar needs more cities," Singh said. "One city requires just a five-kilometre radius. If we build multiple cities, we spread jobs, infrastructure, and reduce overcrowding."

Singh added that bottlenecks are not about intent but implementation. "We have some of the best policies in India on paper. But an entrepreneur needs help executing them—clearances, land, utilities. That bridge between policy and practice is missing."

Still, none of them described these as deal-breakers. "I don't call them frustrations," Shah said. "My dean taught me that problems are opportunities. If Bihar is undervalued today, then the upside is simply bigger tomorrow."

Changing the narrative

Beyond infrastructure and skills, the entrepreneurs believe perception is the hardest battle. "When we sell outside Bihar, customers often hesitate because the product is 'Made in Bihar'," Shah said. "Yet our quality is on par with national brands."

The solution, they argue, lies in branding the state itself. Tourism remains a glaringly underleveraged strength, despite Bodh Gaya being an international destination. "Let people come, see Bihar, experience it firsthand. That's how perceptions change," Singh said.

On prohibition—a controversial state policy—the panel was more cautious. While some admitted it may limit fun-seeking tourists, others argued it reduced social ills. "Everything has two sides," Ranjan said. "For religious tourism, it hardly matters."

Fulfilment and frustration

When asked about the most fulfilling part of doing business in Bihar, the three entrepreneurs paused before offering variations of the same answer: creating jobs.

"In a poor state like ours, where opportunities are scarce, creating livelihoods is the most rewarding thing," said Ranjan.

Singh, whose factories employ locals in Muzaffarpur, said the joy goes beyond balance sheets. He asserted that the satisfaction of seeing the social transformation of workers in their hometowns, spending evenings with their families, is priceless.

For Shah, the fulfilment comes from watching how quickly Bihar's workforce adapts. "A Bihari learns in 24 hours what others take days to master," he said, recalling how his factory staff embraced automation. "Once they grasp it, you can't beat them. That is a source of pride."

Bihar's next chapter

The entrepreneurs agree that Bihar's glorious economic story is yet to be written. For decades, the state has been synonymous with migration, poverty, and underdevelopment, a laggard in India's growth narrative. Yet they believe this is precisely why the opportunity is vast.

"This century belongs to India," Shah said. "But the Bihar chapter is still missing. And that is good news, because it means there is so much left to be tapped."

They point to signals of change: new industrial parks in Motipur and Gaya, ethanol hubs, improved roads that cut delivery times from days to hours, and a surge in private investments—Rs 1.8 lakh crore in proposals last year alone. Even Patna's airport, long derided as a relic, is now a modern international terminal.

For now, though, Bihar remains a work in progress. "It is like buying into a stock before its IPO," Shah said. "The fundamentals are strong, the market is hungry, and the valuation is low. The dividends will come—it is only a matter of time."