VZCZCXRO6595
RR RUEHBI RUEHCI RUEHNEH
DE RUEHCI #0279/01 2950450
ZNR UUUUU ZZH
R 220450Z OCT 09
FM AMCONSUL KOLKATA
TO RUEHC/SECSTATE WASHDC 2480
INFO RUEHCG/AMCONSUL CHENNAI 0999
RUEHBI/AMCONSUL MUMBAI 1002
RUEHNEH/AMCONSUL HYDERABAD 0065
RUEHNE/AMEMBASSY NEW DELHI 2359
RUEHCI/AMCONSUL KOLKATA 3080

UNCLAS SECTION 01 OF 02 KOLKATA 000279 
 
SENSITIVE 
SIPDIS 
 
DEPT FOR SCA/INSB (TITUS) 
 
E.O. 12958: N/A 
TAGS: PGOV ECON EAID EINV IN
SUBJECT: DEVELOPING AND GOVERNING BIHAR: FORGING A WINNING COALITION 
TO REMAIN IN POWER 
 
REF: KOLKATA 132 
 
¶1.  (SBU) Summary: Bihar's Chief Minister Nitish Kumar has made 
visible strides in developing and governing India's third 
largest state, and also one of its poorest, since forming the 
Bihar government in 2005.  The national parliamentary elections 
in May 2009 confirmed the inroads his regional party, Janata Dal 
(United), has made through targeted affirmative action for 
socio-economic minorities in the lower caste political base of 
the state opposition parties, Rashtriya Janata Dal (RJD) and Lok 
Janshakti Party (LJP).  While Kumar's strategy of wooing 
backward castes through targeted outreach and assistance may 
backfire, at this time it appears that JD(U) will remain in 
government in the 2010 Bihar state assembly polls.  It remains 
to be seen whether its tactical alliance with the national party 
Bharatiya Janata Party (BJP) holds or if the regional party 
chooses another coalition party or decides to fight the 
elections alone.  In the meantime, Kumar-led Bihar appears to be 
a reliable partner for development assistance or private sector 
infrastructure investment, particularly in the road and bridge 
sectors. 
 
 
 
Dynamic Governance - The Difference one Kumar Makes 
 
 
 
¶2. (U) Post visits to Bihar, including a recent September PolOFF 
trip, have confirmed both the actual and perceived improvements 
in state governance, development and security.  Chief Minister 
Nitish Kumar has made a breakthrough in the state previously 
known, particularly under the 15 years of Lalu Prasad Yadav's 
RJD rule, for criminalized politics, lack of infrastructure and 
development, high corruption levels and a non-performing 
bureaucracy.  When visiting the state, it is difficult to miss 
the recently completed road and bridge projects, improved civic 
amenities, expansion of higher education institutions, along 
with the more general observation that it is safe, once again, 
to travel throughout the state.  Bihar's development 
expenditure, with priority on infrastructure and social sector, 
increased 80 percent from 2003-04 (USD 3.31 billion) to 2008-09 
(USD 5.99 billion).  The World Bank, Asian Development Bank and 
United Nations Development Program are developing Bihar through 
flood management, highway construction and livelihood projects. 
State bureaucrats have shared what appears to be Kumar's 
strategy of first getting the infrastructure right (roads, power 
and security) in order to be able to recruit private sector 
investments in agriculture and light industry during a second 
term.  There has, under the strong leadership of Bihar civil 
servant Pratyaya Amrit, the current secretary for road 
construction and previous secretary for bridge construction, 
already been significant public-private partnership in these two 
sectors. 
 
 
 
Political and Economic Affirmative Action for Socio-economic 
Minorities 
 
 
 
¶3. (SBU) Kumar's JD(U) has made inroads into RJD and LJP's 
traditional political base through affirmative action programs 
designed for minorities and backward classes.  The government 
has launched a USD 825 million five-year economic development 
program for socio-economically poor "extreme backward" castes. 
In addition to the economic development measures, it has set 
aside seats in local elected bodies for women (50 percent), 
"extreme backwards" (20 percent) and scheduled castes (16 
percent) leaving little seats remaining for the upper caste 
Indian male.  A senior JD(U) parliamentarian, Shivanand Tiwari, 
confirmed that these measures are designed to win over those 
backward sections that had earlier voted en bloc for the RJD or 
the LJP.  State RJD President A.B. Siddiqui and LJP leader Paras 
Paswan agreed that the JD(U) is dividing backward and scheduled 
castes for electoral gains, and not for the altruistic reasons 
of development or the elimination of caste politics.  Siddiqui 
and Paswan see Kumar's measures as contributing to the 
perpetuation of Bihar's caste-dominated society. 
 
 
 
JD(U) Drives NDA Politics in Bihar 
 
 
 
 
KOLKATA 00000279  002 OF 002 
 
 
¶4. (U) The national opposition parties dominate the political 
landscape in Bihar, leaving little space for the Congress or its 
allies.  In Bihar, while the BJP may be the largest party in the 
National Democratic Alliance (NDA), the regional party JD(U) 
calls the shots.  In 2005 the JD(U) and BJP won 148 of the 243 
seats in the state assembly.  In 2009 the NDA, helped by 
infighting within the United Progressive Alliance, won 31 of the 
40 parliamentary seats (See Reftel).  In September the NDA 
suffered a small setback in by-elections to the state assembly, 
when the primary state opposition parties RJD, LJP and Congress 
won 10 constituencies, and the ruling JD (U) and BJP six.  The 
Bihar state assembly polls are scheduled sometime before fall 
¶2010. 
 
 
 
Comment 
 
 
 
¶5. (SBU) In Bihar, it appears that regional parties will 
continue to dominate state politics.  Nitish Kumar's JD(U) is 
strong and will likely return to power; however, post cannot 
completely disregard Yadav's RJD as a political player.  On the 
other hand, Ram Lilas Paswan and his regional party, the LJP, is 
considered to be political less significant post-2009 
parliamentary polls and he is even derogatorily referred to as 
Yadav's political "spare tire".  The JD(U) - BJP tie-up appears 
to be entirely tactical, as opposed to ideological.  At this 
time, there is no indication that it is likely to break, 
however, there is no compelling reason for it to continue 
either.  In 2010 the JD(U) may find another coalition partner or 
decide to go it alone, emulating Naveen Patnaik's ruling Biju 
Janata Dal in Orissa.  Nitish Kumar is delivering and 
transforming Bihar and his government may be a reliable partner 
for USG development assistance or private sector investment in 
infrastructure, particularly in roads and bridges. 
PAYNE