Mineral-rich areas of Bihar and MP were carved out as separate states in the name of sub-nationalist pride to weaken the voice of royalty.
Representational image. (iStock)
The freight equalisation policy, adopted by the Union government in 1952, remained in force until 1993 to facilitate industrialisation throughout the country through subsidised transportation of minerals. However, the policy took away the competitive advantage of mineral-rich eastern states and disincentivised private capital to invest in states such as West Bengal, Assam, Bihar, Jharkhand, Odisha, Madhya Pradesh and Chhattisgarh.