Exterl Orientation Scheme for NE India

By Khanindra Ch. Das

T he world economy has experienced phenomel change in the past one decade or so both economically and politically. Economic changes include growth slowdown in developed world and the rise of Chi, India and the East. Political changes are in the form of rising protectionism and right-wing politics in the developed world especially after the global economic crisis of 2008. The much needed multilateralism, thanks to the World Trade Organization, is losing effectiveness in reaching consensus on important economic issues. Developed countries are going back on globalization, and the rise of tiolism especially in the US and EU can be observed. As a result of the squeeze, emerging countries need to come up with altertive strategy to further economic progress.

India’s response has been to use her exterl connections to leverage domestic economic growth. The ‘Make in India’ is a good example in this regard. However, the policy is yet to attract sufficient investment to reach its manufacturing potential. This is partly due to the existence of altertive production hubs that are well established in the global supply chain, and partly due to higher trade costs in India compared to Chi and East Asia.

To circumvent India’s development bottlenecks and to enhance the flow of trade and commerce, steps are being taken to augment connectivity with countries in the immediate and extended neighbourhoods. India’s emphasis on connectivity is part of a multi-pronged approach in which North East India provides significant strategy space.  The idea is not only to boost economic development but also to maintain strategic interest in the neighbourhood. These economic cum strategic steps are important for India to assume greater role in regiol and global issues.

New Delhi is expecting to harness benefits of regiol integration through expansion of connectivity through neighbouring countries and to reinforce its strategic interest in the immediate neighbourhood in the light of entry of competing powers in the region and the emergence of a multipolar Asia.

Connectivity of North East India was lost while the country earned independence. After decades, the region has been bestowed with a set of opportunities to re-establish intertiol connectivity. These opportunities are due to regiol and bilateral initiatives from New Delhi. The regiol initiatives are BBIN (Bangladesh, Bhutan, India, Nepal) Economic Corridor, Act East Policy, Trilateral Highway project (India-Myanmar-Thailand), and BIMSTEC.

Bilateral initiatives include extension of line of credit for priority infrastructure in the neighbouring countries, and people-to-people exchanges. It may be noted that Guwahati now has Bangladesh Consular office. Rising levels of private sector involvementcan also contribute to better integration. Digital connectivity is going to improve with the laying out of fibre-optical link between India and Myanmar.

Besides, ‘India-Japan Act East Forum’ has been launched to provide a platform for Indian-Japan collaboration under the rubric of India’s ‘Act East Policy’ and Japan’s ‘Free and Open Indo-Pacific Strategy’. Besides, Japan has expressed willingness to fund ongoing as well as upcoming development and infrastructure projects in the Northeast.

These are welcome steps and need to be pursued in a timebound manner. Towards this end, the Government of Assam has set up the Act East Department. Ministry of Exterl Affairs (MEA) has separate Divisions for ASEAN (Association of Southeast Asian tions), Bangladesh and Myanmar. The MEA through its Branch Office in Guwahati is expected to bring coordition of regiol, tiol, and intertiol aspects of connectivity through North East India.

These gains from integration will be both economic and strategic. The Northeast will have the opportunity to diversify growth opportunities and arrest out-migration. Connectivity will turn North East India into a hub for regiol trade and investment, convert informal trade to formal, expand  gainful employment opportunities, and reduce insurgency. Strategically, the policy will be beneficial as expansion trade with neighbours will cement relationships and build bridges to the East Asian neighbourhood. In a nutshell, economic thinking has become a part of India’s strategic thinking, which is nothing short of a regiol approach to globalization.

However, New Delhi and Dispur need to keep in mind the cons. In particular, are we opening a Pandora’s box? If border restrictions are lifted without adequate preparation, there can be genuine problems in various spheres even though one discounts for post-integration insurgency, arms trade, and drugs smuggling.

It must also be recognized that the Northeast has heterogeneity in ethnic, linguistic, cultural, geographical, historical, political, and socio-economic dimensions. Occasiol conflict and non-traditiol security threats are quite common. There structural issues may play a role in shaping the connectivity projects and determining the outcome.

Intra-Northeast connectivity is fragmented due to geographical and infrastructural constraints. Economic efficiency is affected by institutiol setup (e.g. ILP and VI Schedule). Further, people to people connectivity and mobility are constrained by cultural, insurgency and institutiol factors. There is also high degree of identity aspiration, and socio-political issues such as illegal immigration. The solution to illegal immigration has not yet been obtained despite initiation of processes. Grassroot sentiments and livelihood concerns are quite strong in the region.

Addressing the concerns will require confidence building and awareness creation among people, development of projects that can contribute to local economy such that losers are absorbed by design and not by chance, capacity and skill building programmes in technology and services sectors. Last mile connectivity in rural areas will be crucial to minimize pressure on urban infrastructure and seamless movement of workforce. The state of rural infrastructure in Northeast region remains poor despite implementation of various schemes. Keeping the Pandora’s box closed is not the best option either. But certainly, the box needs to be opened in calculated manner and guard against adversaries of various magnitudes.

Active involvement and coordition among Northeast States encompassing pertinent issues, including local economic needs, must form integral part of the connectivity strategy. The Northeast States may not desire to have traditiol manufacturing industries at the cost of serene environment. Instead a strong focus on services, technology parks, education, health, tourism, and environment-friendly industries will be crucial to garner much needed support of the people. Protection of Geographical Indications, agriculture, food processing, and renewable energy projects are promising avenues.

The notion of development is much broader than what is commonly postulated. Given its complexity and interplay of social, political, economic, ethnic, and cultural issues; a flexible approach would be required to make the connectivity initiatives acceptable to masses and sub-sections of society. Enhancing connectivity within the Northeast will complement the Act East Policy. The upgradation of tiol and State Highways must be done uniformly across Northeast region. 

Agendas need to be developed to address these structural issues and concerns in a constructive way and through broad based consultations. It is expected that regiol connectivity with neighbouring countries will bring vibrancy to the regiol economy. With support from all quarters, it is expected that these projects will not become dormant with very little economics due to protest, blockade, and lobbying. New Delhi’s (and Dispur’s) intent to address these issues will go a long way in yielding an economic revolution in India’s Northeast.

(The author is with Bennett University, Greater Noida 201310, UP, India. Views are persol.)