Analysing the North East Economy

For a book that discusses the advantages of the economy of India’s North-Eastern region, given the market diaspora that the rest of India represents, given the latter’s relative advantages of cost of production and demand-supply relations, ‘North East India: Local Economic Development and Global Markets’, a collection of essays edited by Hans-Peter Brunner, is an apt analysis of the reasons behind the economic distress that plagues the region. Among the reasons that he ascribes for this condition is the partition in 1947, weak infrastructure, lack of technological knowhow and poor access to marketing networks; but more importantly, the book highlights how developmental debates about the region have focused on the relations between development and unrest, conflict and insurgency.

As a Senior Economist with the Asian Development Bank, Brunner seeks to fit together the different components of India’s export strategy and that of the North Eastern Region. This is even as it discusses the various ways in which the North-East economy can be reconnected to the economic activities taking place in mainstream India. As Brunner says in the introduction, the book not only talks about how: “The dynamics of change and growth do tell a story on how regions and countries lose their prosperity, but also what key factors make them gain economic strength.” The book seeks to highlight how efforts at mainstreaming trade development in the region would result in spillover benefits, especially through improved industrial and agriculture efficiencies. But for this to happen, as the books notes, what is needed is a ‘considerable stepping up of public investment in physical and social infrastructure and creating an accommodative climate for private investments.”

Again, while these are important areas, what is perhaps most needed in the North-Eastern region is an improvement in its logistics infrastructure and its supply and value chains. This is an essential requirement, if the region is to “diversify trade in terms of sectors and markets”. For this purpose, the collection emphasises that the need of the hour is to create more land links that can “open the doors to a massive and dynamic customer base that already rivals the scale of those of North Amercia and the European Union.” But then, as the collection repeatedly emphasises before any business from the North-East can successfully join a value chain, there has to be a mechanism in place that can determine what this value chain is.

In this compilation, Brunner also makes it clear that while physical or actual infrastructure is an essential necessity, what is perhaps more important is the need to change the image and reputation of the North-East as an unstable, backward and violent region. Such change is essential, if the debate between development and conflict, between improved living and economic distress are to be suitably tackled.