The study also suggested that initiatives should be taken to combine external expertise with local knowledge, as part of the broad efforts to strengthen the development process.

Bihar, it adds, faces many challenges, but despite a difficult environment there are instances of successful development efforts. One needs to look at Bihar State Cooperative Milk Producers' Federation, Muzaffarpur's national literacy campaign, or the Paliganj participatory irrigation management experience as examples of excellence. The study stresses that these demonstrate that projects can succeed, entrepreneurship can thrive, and that strong leadership and a vision for change could yield dramatic results.

Referring to basic pillars of development, the study said that efforts should be made to enhance Bihar's growth performance by establishing a healthy investment climate. This would encourage entrepreneurship and investment, and would spread improved technologies, particularly in the rural sector.

Improvement in investment climate would also require improvement in basic law and order situation. The report added that perception of endemic law and order problem is clearly a risk factor which current and potential investors are very concerned about.

As far as fiscal reforms strategy is concerned, the study underlined the need for developing a medium-term expenditure framework (MTEF), around which, feasible and sequenced fiscal measures can be envisioned to address the issue of expenditure restructuring. Efforts should also be made to strengthen public expenditure management in areas of budget preparation, accounting and audit, procurement, and cash management. This should complement expenditure reviews to prioritise programmes and to identify areas of waste.

The state's administrative reforms agenda, the report said, would be fundamental not only to the efficient use of public resources but also to the improvement of many dimensions of government performance. The areas that needed to be focussed upon are strengthening of decision-making procedures, restructuring of civil service staffing, establishing meritocratic civil service practices, rationalising government functions and staffing, and making government more accountable to the citizens. u

The study also underlined the need for improving the system with a view to reducing the load of legal cases.