Northeastern Region (India) : Status and Constraints of Foreign Economic Relations

The Indian northeastern region has two century old history of traffic, transit and exchange of goods with the neighbouring countries of Bangladesh, Bhutan, China and Myanmar. Neither the trans-border and trans-frontier nor the trans-Himalayan trade interaction are new phenomena for the region. Across an extensive surface-road link, Assam, Meghalaya and Arunachal Pradesh had been the transit routes for traffic of goods originating in Bengal, Lhasa and Rangoon. In the backdrop of a disruption in trade and commerce during the first few decades of the second half of twentieth century, the year 1995 was a landmark. There has been a sort of the revival, and accordingly, serious research on the theme of in traffic, transit and trade relations began again as observed in the regional trade historiography and literature on economic analysis of foreign trade. Alas! The region still acts as the transit route for the traffic in goods and also fake currency. Moreover, the volume and value of trade between the northeastern region and neighbouring countries is almost negligible percentage of the volume and value of aggregate trade between India (as a whole) and neighbouring countries of Bangladesh, Bhutan, China and Myanmar. The specific constraints are to be traced in the nature of the laggard economy of the region. The region suffers from deficits in commodities production, shortfalls in financial revenue mobilization, and the transport bottlenecks. These are profound constraints behind the objective function of increasing region’s share in foreign trade and commerce.