07/01/2020 - Geography | Mainstorming

IAS Parliament 5 years

KEY POINTS

A smooth economic take-off by NER is central to India’s moving closer to the $5-trillion-dream.

Challenges

· The north eastern region continues to be a net importer of food grains even for its own consumption. Even with 33% of country’s water resources, the region reels from acute water distress.

· The RBI’s “Report on State Finances: A Study of Budgets 2017-18 And 2018-19” shows that visible fiscal pressures are emerging for NER states on the expenditure side, particularly on account of pay revisions and interest payments.

· Limited borrowing capacities and a limited supply of central funds raises bigger challenges. Revenue mobilisation remains the key to attaining the budgeted targets.

· Thousands of farmers still can’t access small ticket loans for poultry, dairy and piggery projects. With a less than 1% share of the total credit flow in India, sustained gaps in credit to lakhs of small and marginal farmers has haunted the entire region for decades.

Potential resources

· Hydropower potential of nearly 50,000 MW, natural gas reserves of 190 billion cubic metres, coal reserves of over 900 million tonnes and oil reserves of over 500 million tonnes.

· Innovative PPP models may be the solution with the state governments facilitating access to land on a long-term basis to the private sector, and village councils becoming a part of the partnerships from the very inception.

· The entire region with rich soil types, sufficient rainfall and diverse agro-climatic conditions is home to unique organic agri-produce with untapped export potential. This produce, its grading, packing, processing and marketing will be the dynamic key differentiators for NER someday.

· Then there is the immense potential of tourism. Most footfalls are restricted to Sikkim, Mizoram, Meghalaya and Nagaland are virtually untapped destinations.

· For these states, with limited financial resources to launch aggressive marketing campaigns, social media-based advertising campaigns and strategic tie-ups under CSR may just be the answer.

· On the credit front, banks need to partner with other service providers to expand their reach through innovative tie-ups in this difficult region.

· Small finance banks with their entire business model centred around financial technology can prove to be the connecting links. It is imperative for state governments to use funds judiciously and build adequate road infrastructure to further the agenda of both bank credit, as well as, network connectivity.