FCC

Unlocking investment potential in the North East region

2023-10-18

The North-Eastern Region (NER) of India has great economic potential. It has large deposits of oil, natural gas, coal, and limestone, and a sizable proportion of land under cultivation for agro-horticulture products, tea, bamboo, and rubber. The region shares its border with the south Asian countries, and its geographic proximity to South East Asia makes it a pivot to implement India’s Act East policy. However, NER has yet to function as a hub connecting India to the rest of the world.

However, despite its rich natural capital, strategic position, and government intervention, NER contributes only 2.8 per cent to the nation’s GDP, with the secondary sector contributing just about 18 per cent of the state’s income. Challenging terrains, limited connectivity, and an inadequate business ecosystem are among the main causes for low private investments and poor industrial infrastructure in the region; thereby leveraging its natural proximity with the wider Asian region. Individual states in NER suffer from a lack of scale economies and manpower skills, leaving them as economic laggards vis-à-vis the rest of India.