Ministry for Development of North Eastern Region

Mani Shankar Aiyar, Minister "When we see that the Central Ministry to spend 10% of their gross budgetary support in the North-
East, it reflects that there is no neglect. In fact, it amounts to affirmative positive action.


Arunchal Prades

Gegong Apang
"The NDC, the apex national planning body of the country, has to foster consensus building
amidst diverse and varying perspectives to minimize these imbalances in a time bound manner"


Tarun Gogoi "A modified NEIP should be formulated exclusively for the North Eastern states so that the benefit of
the policy can be reaped by the states of this region during Eleventh Plan."


O. Ibobi Singh, "During the five year period of Eleventh Plan, administration and physical infrastructure needs to be
strengthened to enable the North Eastern States to respond appropriately to the liberalized polic."


D.D. Lapang "The idea of an economic zone for the North East Region may perhaps be a good idea, if sound
economic policies, strategies & activities can be ensured in an integrated manner."


Zoramthanga "It is necessary to have flexible norms and guidelines for implementation of the various Central
schemes in order to cater to the peculiar requirements of the hilly States which still require special attention."


Neiphiu Rio "The northeast region could become an effective cultural and economic bridge between India and
South East Asia. To achieve this objective infrastructure development must be stepped up."


Pawan Chamling "The Governments of North East have been, yet again have been advised to go for open marketing
borrowing. As we are all aware, the financial position of the North eastern States is not healthy and the loan indebtedness is putting us on the road of debt trap. As such I would urge a reconsideration of this issue at the highest quarters".


Manik Sarkar The growing feeling of discontent and frustration and a sense of injustice is attributed to regional

imbalance. We must make all efforts to dispel such negative and disruptive feelings, which can also drive the people, particularly a section of young and unemployed, to the path of extremism and other anti-national activities.

North East Council (NEC)





The Sleeping Giant waking up

THE story of an unending tail of adversaries -- hilly and inhospitable terrains, porous borders, highly inadequate road links, extremely poor transport connectivity barring limited air services, inadequate rail links; and weak telecommunication infrastructure has to end without killing anymore time, if India’s latent economic power house, the north-eastern region, is expected to position itself as the back office for the South East and Far East Asian countries. The proposed Trilateral Highway from Moreh in Manipur to Mae Sot in Thailand through Bagan in Myanmar that is expected to be completed by 2011, is going to play a crucial role in India’s trade with the Far East and South East regions. A sleeping giant is waking up. It’s time that the North East Council with a more proactive support from the federal government of India discharges the Herculean task of getting the home turf ready on a war footing. India cannot afford to miss this bus when other neighbouring countries, especially China, are fast catching up to have bigger slice in international trade. The region’s partner states namely Arunchal Pradesh; Assam; Manipur; Meghalaya; Mizoram; Nagaland; Sikkim; and Tripura are in high spirit to build up the springboard of country’s Look East policy which is expected to change the economic profile of India significantly in coming years.

The Shillong Statement on Roads and Highways (February 9, 2007) reflects the similar sentiment expressed by the region's partner states. The Statement says: "The opening of International Trade Centres at several different points along external frontiers of the North-East region, which comprises 98% of the North-East's borders, is an urgent economic necessity and a vital requirement for the Look East policy to bear fruit. With this in view, the Border Areas Development Programme requires a fresh look and a new orientation. The Ministry of DoNER will work with the Ministry of Home affairs and the Ministry of External Affairs towards this end".

IN order to address a major concern of Indian government -- infrastructure deficiency -- so far as northeastern region is concerned, all state capitals in the region are being linked with rail lines. Development should be the "dominant recurrent theme" of discourse for the north east unlike violence and emphasized that there is "no grievance that can be redressed through a barrel of a gun", said Prime Minister Manmohan Singh while releasing the North Eastern Region Vision 2020 Document.

“You will be happy to know that we have decided to link all State Capitals with railway lines. These projects have been given the status of National Projects with a special funding pattern. Airports are being modernized and new ones are being built. An ambitious programme of road building has been taken up under the Special Accelerated Road Development Programme for the North East (SARDP-NE) and an amount of Rs. 31,000 crore is being invested on roads in the 11th Five Year Plan. There are relaxed guidelines for rural roads under the Pradhan Mantri Gram Sadak Yojana (PMGSY) so that even the farthest hamlets on the border are linked by road. Within the 11th Plan period, these interventions will begin to show positive results”, the Prime Minister said.

To bridge the infrastructure gap in the region, Indian government has taken several initiatives. Work on the Tipaimukh and Loktak Downstream Hydro Electric Projects, costing about Rs.6,000 crores and Rs. 800 crores respectively, has been expedited. The 726 MW Palatana Gas based Power Plant, with an outlay of Rs.3,000 crores, a 750 MW Thermal Power Plant at Bongaigaon with an outlay of Rs. 4375 crores, and the Assam Gas Cracker Project have all broken ground. The Kumarghat-Agartala railway line has been approved as a National project, with an outlay of Rs. 750 crores. The Jiribam–Tupu-Imphal railway line, which will put the Manipur valley on the rail map of India, has also been sanctioned as a National project for Rs. 727 crores.

The Gangtok Declaration on Tourism and Hospitality sector has pointed out that poor connectivity-both road and rail- has been the major impediment to the development of tourism in the state. So far as air connectivity is concerned, it is being upgraded and strengthened by the Civil Aviation ministry. A dedicated regional airlines service in the north-east region is also being actively considered by the federal government.

The NEC’s target groups for tourism promotion are both domestic and foreign tourists, with the highest priority being accorded to the domestic sector and particularly targeted at states like Gujarat and West Bengal which generate a high promotion of domestic tourism.

To improve the road connectivity, the federal government is planning massive investments to the tune of Rs 50,000 crore over a span of five years. Only recently the Prime Minister has announced Rs 19 billion investments in railways for two new national projects. A special fund is being created for the railway projects in the region. But increase in investments alone will not do. The region has to have the absorbing capacity as well, observed Deputy Chairman of the Planning Commission Montek Singh Ahluwalia. “There is a need to increase fund absorption capacity of the region. During the 10th Five Year Plan, Rs 10,400 crore was earmarked for the North east under non-lapsable central pool of resources, out of which the region utilized only Rs 46690 crore. From all the resources, Rs 80,943 crore was invested in the region during the 10th Plan,” he recently said in a conference on Look East policy.

NEC’s sectoral summit report on Information Technology this year said that the north eastern region is rich in English speaking and educated manpower which is available may for m the backbone of the ITeS-BPO industry in the country. As the personnel costs of IT industry in the rest of the country is going up, the NER, with comparatively low wages, should be in a position to attract IT companies. The IT industry should take advantage of this highly talented resource. The federal ministry of Development of North eastern region is supporting the NASSCOM Assessment of Competence Test for 20,000 undergraduate youth of the region.

In an interview the Assam IT Secretary V.S.Bhaskar also emphasized on high literacy rate and highest number of English speaking workforce in the region. An IIT and number of Technical institiutes are rolling out large number of qualified professionalhe said. About creation of a special fund for IT sector, Bhaskar said: “DONER may have a special fund for IT sector. Bandwidth costs need to be subsidised because of its remoteness from international cable landing stations in India. Also spending in the IT sector has to be increased in this region to develop IT activities.”

M.G.Kiran, IT Secretary of Sikkim also said in an interview that it would be “a good idea to have a corpus fund for the development of IT in the North-East. A fraction of the Non Lapsable Pool of Central Resources (NLPCR) should be kept aside for fuelling the growth of IT industry in the region which would lead to the strengthening the economy, creation of employment opportunities and income generation in the private sector.” Because of its geographical congruity to the South East Asian Countries the North Eastern region can become "a thriving platform for providing various services", he said.

  • Large natural resources and potential for growth in the agro-forestry and horticultural sectors including expansive and extensive bamboo plantation, exotic flora.

  • Large mineral deposits (particularly in Assam and Meghalaya).

  • A vast bio-diversity hot spot.

  • Vast water resources including tremendous hydel power potential.

  • Proximity to one of world's fastest-growing economies, the S.E. Asia.

  • A highly literate population.

  • Rich heritage of handicrafts/handloom/tribal artifacts.

  • Strong community spirit and traditional democratic system of local self-government

SOURCE: NEC Annual Plan 2007-08

<Strength & Weakness>
  • Inadequate development of basic infrastructure

  • Geographical isolation and difficult terrain that reduces mobility: high rainfall and recurring flood in the Brahmaputra Valley

  • Lack of capital formation and proper enterprise-climate

  • Slow technology spread

  • Absence of a supporting market structure and adequate institutional finance structure

  • Low level of private sector investment.

  • Lack of local agricultural surplus

  • Insurgency problems

  • Late start

NER has about 50,000 Internet connections “which is woefully inadequate”. The bandwidth connectivity is poor in the region. The bandwidth costing the region is very high in comparison with the rest of the country. “ There is a link between Hospitality industry and IT industry. The cities in the region however do not have good hotels and other quality tourist and recreation facilities. Apart from the infrastructure for the IT sector itself, due emphasis has to be given to the development of tourism infrastructure.

11th Plan : Thrust Areas

The North East Council has identified four thrust areas  for sustained support by the Council during the 11th Plan period. They include Connectivity; Power Development in general, and Transmission, Sub-transmission and System Improvement; Institution Development; and Capacity Building.


Road connectivity has been identified as the biggest constraint to development of the region. The spillover cost of the 10th Plan road construction schemes/projects is assessed at Rs 1229.33 crore including Rs 47.92 crore relating to the 9th Plan road schemes. A Task Force has recommended to complete all 9th Plan spillover schemes during the current fiscal (2007-08) and the 10th Plan spillover schemes within first three years of the 11th Plan subject to the availability of funds. The Task Force has also recommended assistance to States for preparation of DPRs for upgradation of NEC-funded roads. In total 30 timber bridges on completed NEC-funded roads have been recommended for conversion into permanent bridges during the current fiscal.

During 10th Plan period both ISBT and ISTT at Guwahati and Silchar have been completed. The Task Force has recommended completion of the ISBTs at Aizawl, Agartala, Jorhat and Mokakchung during the current fiscal and support to ISBTs in Arunachal Pradesh, Meghalaya, Manipur and Sikkim during the 11th Plan period.

The federal government has intention to invest nearly Rs 5000 crore in projectes relating to road connectivity in the region over a span of five years during the 11th Plan.

So far as rail connectivity is concerned, the Prime Minister has recently announced a package of Rs 19.8 billion for railway projects in the region. These projects include Bogibeel rail-cum-road bridge and the Rangia-Murkongselek railway line conversion from metre gauge to broad gauge in Assam. According to the PM's directive, a uniform funding pattern for the remaining five sanctioned national projects for the region will be implemented. The approved funds would get additional budgetary support to the Railways to complete these seven projects in all. The Railway ministry's sixth sectoral summit of the North East Council (NEC) chaired by the federal minister for North East Development identified a number of existing roads which calls for immediate attention to improve rail connectivity to the area. The list includes the two projects for which the Prime Minister has approved Rs 19.8 billion.  

Even the air connectivity that was supposed to be run and supervised by Alliance Air, a subsidiary of Indian (formerly Indian Airlines) is extremely poor. About air connectivity in the region, the Manipur Governor Dr S.S.Sidhu who is heading a committee on air connectivity in NER in his speech in a crucial NEC meeting in May expressed serious concern over the current state of affairs in respect of air connectivity. It is revealed that the airlines which had Memorandum of Understanding with the NEC, virtually failed to honour most of its commitments. "NEC has released Rs 175 crore without commensurate benefits; Guwahati did not materialize as a Hub as per the MoU; Alliance Air operations continued to emanate from Kolkata, negating the objective laid down in the MoU and the airlines though lately increased services in the region, only 30 percent of its total operations are in the region, the remaining 70 percent are beyond NE region."

The Sidhu Committee constituted by the Minister for North East Development in its report suggested two options: Public Private Partnership model: a joint venture airline allowing the private operator majority stake (74 percent) and remaining 26 percent be hold by NEC OR Reverse Bidding Agreement (minimum subsidy route). To ensure transparency and fair play, the Committee further recommended issue of Public Notice for Expression of Interest and short listed bidders be asked to submit technical and Financial Bids.

Dr Sidhu in his presentation suggested that "The selected entity/airline should be based in North East and its operations dedicated to the Region with following objectives: Improve intra-region air connectivity; Connecting 11 other airports within one year; Inter linkages of State Capitals on daily or alternate day (depending on traffic); Pathfinder for future locations. He has also suggested that Guwahati to be initial Hub. Sub-Hub could be set up at Imphal/Agartala. While Agartala has Night Landing Facility, Imphal will have to have NLF by  December, 2007. Besides, 11 non-operational airports of the region to be expeditiously made serviceable. The Greenfield projects could be at Kohima, Gangtok, Itanagar, Tawang and Kokrajar.


Next to road connectivity, the second topmost priority has been given to Power sector development. This is reflected in higher allocation for this sector of Rs 65 crore from Rs 39.50 crore allocated in fiscal 2006-07. At the end of  December, 2006 the installed capacity of the region's power sector stood at 2520.30 MW (effective output about 1800 MW). the peak demand forecast by 2011-12 is estimated at 2620 MW and energy requirements at 13649 MU. The installed capacity is proposed to be doubled by the end of the 11th Plan.

The Pasighat Summit has recognized small hydropower projects as ideal for providing electricity to remote and scattered hamlets in large parts of the region. The region has vast hydro power potential estimated at about 60,000 megawatt. Only about 2 percent has been tapped so far. Most of this potential lies in Arunachal Pradesh. Besides shortfalls in power generation, the region slipped in terms of power generation capacity addition as well. The shortfall is estimated at 810 MW.

National thermal Power Corporation's 510 MW Teesta Hydro-V project is expected to be commissioned during the current fiscal. The federal Power ministry/NHPC hope to complete 2000MW Lower Subansiri Hydro Project within the 11th plan period. Meanwhile, Arunachal Pradesh has requested that the Planning Commission and the federal government to assist the state government to take up equity in the mega hydro projects proposed to be taken up as joint ventures with CPSUs & IPPs. ONGC & ILFS are in the process of setting up the 750 MW Paltana Gas Power Project in Tripura. Only Tripura and Assam have entered into MoU with ONGC/ILFS for purchase of power.

In respect of transmission and distribution, four states -Meghalaya, Manipur, Mizoram & Sikkim are connected by omnly 132 KV. The T&D loss in the region is abnormally high - between 28.35 percent (Meghalaya) and 70.61 percent in Manipur.. Of the total 40,377 inhabited villages, 25,248 villages have been electrified till October 2006. Only 24 percent of rural households have been electrified.

The sectoral summit on Power held in January this year has recommended two-pronged strategy: (1) Small/Localized Hydel & Thermal and NRE projects to fulfill local needs; (2) High capacity Hydel & Thermal Power Projects with associated Transmission lines for first meeting the demand for power of the North eastern region and thereafter that of the rest of the country.

Institution Development

The North east Council has played a pivotal role in strengthening various institutions including RIMS, Imphal RIPANS, Aizawl, LGBRIMH, Tezpur, NEPA, Umsaw, Shilliong etc. NEC has also extended support to several other institutions like the BBCI, Shankardeva Nethralaya, RDC, RNC, GMC etc. Besides providing better healthcare, the health institutions and NEPA have assisted in capacity building. Apart from continuing support to these institutions, it is proposed to set up Nursing colleges in the PPP mode, a Pilot training Centre in collaboration with the Ministry of Civil Aviation, a Fashion technology Institute in collaboration with NIFT/Ministry of Textiles and a Mountaineering-cum-Adventure Sports Institute in collaboration with the HMI, Darjeeling.

Capacity Building

To enhance the scope of employment of the educated youth in the region, the North East Council proposed to impart a renewed thrust to skill development in collaboration with reputed institutions. With this end in view it has been proposed to support teachers training programmes in consultation with the federal ministry of Human resource Development; federal ministry of YAS and the state governments with the help of the teachers training institutes, universities. Although communities in the region have access to bamboo resources but they are unable to benefit from value addition. The North East Council proposes to support capacity building in the bamboo sector.

Source : North East Council Annual Plan 2007-08 & Sectoral Summit reports, 2007


The North Eastern Region (NER) continued to receive special attention and enhanced allocations. In the federal Budget 2008-09 an amount of Rs. 1,445 crore has been provided to the Ministry of Development of North Eastern Region(DONER). The total Budget allocation for NER, spared over different ministries/departments, will increase from Rs. 14,365 crore in 2007-08 to Rs. 16,447 crore in 2008-09.

In his Budget speech Finance minister P Chidambaram stated that the North Eastern Region especially, the border areas face special problems that cannot be tackled in the usual course or through normal schemes. Hence, the Government proposed to identify the urgent needs of these areas and addressed them through a special mechanism. A sum of Rs. 500 crore in a fund dedicated for this purpose has been set aside in the Budget.

NEXT : Neglect no more; winds of change blowing

DoNER    North East Council     Arunchal Pradesh     Assam     Manipur    Meghalaya  Mizoram     Nagaland     Sikkim     Tripura