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India–ASEAN Economic Relations and North-east India: Act East Policy as a New Paradigm

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  • Dipon Ghosh

Abstract

The article delves into three aspects: (a) India–ASEAN economic relationship since the last three decades of Look East Policy (LEP), (b) the achievements of North-east India (NEI) under LEP and Act East Policy (AEP) and (c) adding a note on AEP as a new ‘development paradigm’ in NEI. The study finds that the India–ASEAN economic relationship deepened in the post-LEP period as merchandise trade and foreign direct investment (FDI) inflows increased manifold. However, neither LEP nor AEP made any significant impact on NEI in terms of economic growth, exports and FDI inflows. Economic growth stagnated and even decelerated in some states in NEI, while exports and FDI inflows remained abysmally low. LEP was a failed policy instrument for NEI despite many claims and assumptions. The major reason was infrastructure deficits and poor connectivity in the region for a prolonged period. AEP has emerged as a new ‘development paradigm’ with renewed thrust on infrastructure buildup and connectivity constructions. The ongoing and completed connectivity projects in rail, road, air and water, improvement in power and telecom, multimodal logistic park in Assam and improvement of trade infrastructure in NEI under AEP would attract investment from both domestic foreign sources, enhance productive capacity, increase exports and accelerate economic growth. AEP is expected to open new possibilities for trade and investments in NEI through regional economic integration with South Asian and South-east Asian economies given geographical location, ethno-cultural proximity, historical linkages and resource endowments.

Suggested Citation

  • Dipon Ghosh, 2024. "India–ASEAN Economic Relations and North-east India: Act East Policy as a New Paradigm," India Quarterly: A Journal of International Affairs, , vol. 80(2), pages 196-218, June.
  • Handle: RePEc:sae:indqtr:v:80:y:2024:i:2:p:196-218
    DOI: 10.1177/09749284241241594
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    Keywords

    India; ASEAN; LEP; trade; investment; AEP;
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