The Northeast, positioned as the gateway to ASEAN, lies at the heart of India’s ‘Act East Policy’. Development of the region, so far a domestic policy concern, has now been aligned with national strategic and economic objectives. The underlying assumption is that trade across the borders will usher in economic prosperity to this hitherto neglected frontier. It would be useful to draw comparisons with China’s approach in Yunnan, a ‘bridgehead’ to South and Southeast Asia, as part of its ambitious Belt and Road Initiative.
Similarities and differences
Yunnan and the Northeast have much in common: populations of a similar size, mountainous regions, diverse indigenous communities, a rich natural resource base, huge hydropower potential and historically lower levels of development. Yunnan shares a 4,000 km-long international border with Myanmar, Laos and Vietnam. The Northeast abuts China, Myanmar and Bangladesh over a length of 5,000 km. Yet, behind these apparent similarities lie stark contrasts in economic reality.
The GDP of Yunnan is about $265 billion, of which tourism contributes nearly a quarter. Trade across the land border of Yunnan with ASEAN is in the range of $14 billion, half of which is with Myanmar. In contrast, the combined GSDP of the Northeast is approximately $65 billion. A restrictive regulatory regime (Inner Line Permit for domestic tourists and Restricted Area Permit for foreigners) poses entry barriers. Indian border trade with Myanmar (through the sole functional custom station at Moreh) has hovered around $50 million for several years. This calls for a closer look at three crucial aspects: connectivity, border trade and ecotourism.
The Northeast is catching up in air, rail and highway connectivity, though it lags behind Yunnan. Kunming, the headquarter of Yunnan, has a flourishing international airport. For the first time, all eight States of the Northeast have at least one functional civilian airport, with efficient internal connectivity via Kolkata and Guwahati. International flights to Dhaka have commenced from Guwahati recently, and flights to Bangkok and four more cities of ASEAN are in the pipeline under the UDAN scheme. Yunnan has a rail network connecting cities like Beijing, Shanghai and Guangzhou. The rail footprint in the Northeast is weak, though the Railway Ministry has announced its intent to ensure internal rail connectivity by March 2022. Yunnan has an impressive highway network providing city to port connectivity. The Northeast has seen a spurt of public investments in national highways and bridges, with remarkable results in the last few years, though internal roads remain a challenge.
Yunnan has a well crafted trade strategy, while border trade across the Northeast has been sluggish. The Ruili Border Economic Zone is the main hub for facilitating Yunnan’s trade with Myanmar. Ruili city has transformed from being a sleepy border town to a thriving economic zone. China is now aspiring to develop an economic zone with Myanmar between Ruili and Muse. The project aims to develop core infrastructure and invite private investment for manufacturing, processing, trading and warehousing. The Zokhawthar land customs station in Mizoram has fragmented infrastructure and barely sees any formal trade. Trade across the integrated check post at Moreh in Manipur has shown promise. Absence of robust internal connectivity, infrastructure for logistics, warehousing and processing has hampered meaningful trade. Ambitious transnational projects, such as the Kaladan multi-modal transit transport project, have also been slow to take off on account of niggling land acquisition problems.
Building blocks
Yunnan has experimented with some imaginative approaches for ecotourism embracing local communities. Ecotourism in Xishuangbanna has been anchored in ‘ecological villages’, showcasing the culture, architecture, customs and cuisine of the Dai ethnic community. The villagers partner through land leasing arrangements with companies, allowing tourists to catch a glimpse into the Dai way of life. Nagaland has made a good beginning with the Hornbill festival, but there are opportunities in other States too. Following this path would help encourage private investment in tourism infrastructure. Tourism revolving around ecology, culture and ethnicity would ensure that there is no disruption in the tribal way of life and contribute to the economy.
A discernible focus on the development of the Northeast has yielded results in the last few years. Now is the time to empower the States to build blocks. Taking a leaf out of the experience of Yunnan could provide a template for the transformation of this frontier.
Ashish Kundra is an IAS officer currently working with the Government of Mizoram . Views are personal
