Industries and Associated Economic Activities

Abstract

North-East India is industrially far less developed than most other parts of India. A few industries that have grown here are based on local raw material, where raw material is the primary governing factor in the location of these industries. Such industries are tea, petroleum, petroleum refineries and petroleum products, chemicals and fertiliser, plywood, pulp and paper, cement and thermal power-generating units. Besides, the region has a strong core of cottage industry, the most important of which is silk yarn and cloth and other forest-based industries, like bamboo products, furniture and a variety of domestic utility goods. Among the states of North-East India, Assam is the most industrialised state. In Assam, there are a very few industrial clusters which are concentrated in the North-Eastern corner of the state, centred around Digboi and Nahorkatiya, the two principal petroleum and gas fields. The four oil refineries are almost equally spaced in their location. These are at Digboi, Numaligarh in Golaghat district, Guwahati and Bongaigaon. The last station has also developed a mega thermal power unit with an installed capacity of 500 MW power generation. In Meghalaya, there are several cement factories that utilise the local limestone. A gas-based mega thermal power-generating unit is established in Tripura, using locally extracted natural gas. The greatest hope of the region lies in harnessing the hydroelectric potential of Arunachal rivers, which have a potential of 50,000 MW, 50 % of the total hydroelectric power potential of India. The contribution of industries to the economy of the region, as a whole, is limited to less than 20 %, and much of the income is generated from the tertiary sector of the economy.

Besides the fact that the region doesn’t possess the advantage of a huge market, and distribution of manufactured goods is not quite economic because of a long haul of transport, there are other factors which inhibit the growth of industries. The most important of these is the absence of an encouraging atmosphere, reflected in insurgencies, hindrance in building an industrial unit, threats of extortion, violence and an overall attitude of hostility to entrepreneurs and investors. Even in the government-sponsored projects like the gauge conversion of tracks, the railways face these difficulties. Among other things, the socio-political environment needs to change to attract industries. There is a perception that opening of the East–West corridor linking India with Southeast Asia via North-East India will bring industries to the region, but it is not a certainty.