Perspectives on Growth and Development in the Northeast

Abstract

This paper critically examines the relevance of the Look East Policy for the industrialisation of the northeastern region of India. While recognising the strategic and political importance of the northeast in formulating India's neo-economic diplomacy and foreign policy is a positive step, it remains a mystery as to when the Look East Policy became the new paradigm of development for the region. A myth has been created, possibly to woo voters of the region, that the Look East Policy can be an effective instrument with unlimited scope for the region to engage in international trade with the booming east and the south-east Asian markets, which in turn would provide opportunities for industrialisation and growth. We argue in this paper that this is a far-fetched belief, as opportunities for trade have never been a constraint in the region. In fact, the region had been exposed to international trade on a massive scale during the late-nineteenth century, which continued until India's independence, but this has hardly had any impact on the region's economy. So, the real problem of development even today is not really the lack of trading opportunities. The crucial constraints to development faced by the region are the lack of intra-regional and intra-state connectivity and trade, infrastructure, security and governance. The new paradigm of development seems to ignore these constraints by diverting attention to an issue (i.e., connectivity with the outside world) which may have only a marginal impact upon the economy.