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North-East India: An Untapped Emerging Market

von Abhishek Dubey (Autor) Dr. Rahil Yusuf Zai (Autor)

Forschungsarbeit 2010 13 Seiten

BWL - Offline-Marketing und Online-Marketing


Abstract: The North East of India comprising of the 8 states of Assam, Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Tripura and Sikkim, is a reservoir of rich natural resources and a beautiful amalgamation of different people and cultures. It surely is a region waiting to happen. Blessed with biodiversity, huge hydro-energy potential, oil and gas, coal, limestone, forest wealth, fruits and vegetables, flowers, herbs and aromatic plants, rare and rich flora and fauna, NE India has all the potential to transform into a commercial hub and tourist paradise. The region shares borders with China in the north, Bangladesh in the South-West, Bhutan in the North-West and Myanmar in the East. This makes the North-East a prospective hub of international trade and commerce. Unlike the rest of India, North East India has an added demographic advantage, in the sense that it occupies 7.8 per cent of the country’s total land space but has a population of 3.8 crore, which makes it approximately 3.73 per cent of the country’s population. This is also a huge untapped, emerging market, which should prove to be of interest to large domestic and international investors.

Keywords: North East India, Untapped, Emerging, Tourist, Investment, Market, Economic, Trade.


India ranks among the well known emerging markets in the global economic scenario. Since the economic liberalization policies were undertaken in the 1990s, emerging market India has really prospered which has helped to boost the Indian economy to a great extent.

While the Indian economy has often been compared to a lumbering elephant, its sustained growth since the 1990s has often been viewed as a sign of its imminent arrival in the developed set. A growing voice at the international forum, it is hard to ignore this relatively stable and cohesive nation in South-East Asia. Belonging to much spoken about BRIC nations, this largest democracy in the world is moving from just being the world’s back office to a hub of financial activities.

Fiscal deficits run up in the good times may just prove to be the albatross around the next government’s neck as it faces the challenging task of pruning the debt in times of a slowdown.

India’s relatively low ranking of 120 in the Doing Business Report 2008 is indicative of an institutional framework that, at times, seems to work against the business and entrepreneur. A complex taxation system poses a daunting task for businesses. But in recent times the government has acknowledged this challenge and has taken initiatives to incorporate better technology and greater accountability in the functioning.

While the political leadership would like us to believe that the domestic economy is strong enough to withstand any shocks that the current recession may throw up, multiple trade tie-ups with the US and several European countries have already thrown the handicraft and textile industry into a downward spiral.

As the myth of decoupling becomes lore of the past, India will have to work very hard to find a balance between the growing economic insecurity, escalating fiscal deficit and national security concerns as its neighbours remain mired in internal conflicts. Its advantages include a GDP growth rate still far ahead of several developed nations, a sizeable consumer market and educated population base, and its expertise in sectors such as IT, telecommunications etc. It is a steady and attractive emerging market in South East Asia and should continue to be viewed favourably.

Factors behind the favorable emerging market in India

In simple terms, emerging market is used to evaluate the socio economic scenario of the country in terms of the growth of the market and industrial development. According to the recent survey, there are around 28 emerging markets in the world out of which India ranks in the second place.

The main factors behind this booming emerging market are the economic liberalization and the perfect competition market, the high standard of living and per capita income, the development of medical facilities and infrastructure, the increase in foreign investments and so on. Over the few years, there has been a significant growth of the Indian market which has resulted in the high Gross Domestic Product (GDP). The average annual growth rate ranges between 6 to 7 %. The growth rate of GDP was around 6.7 % during the financial year 2008-09.

To boost the emerging market India, the government is also taking some positive steps. The main aim is to increase the growth rate to around 9 %. Due to the favorable emerging market, more and more industries are being set up and the customer base is also increasing. Currently, India is the 4th largest economic system in the world in terms of the purchasing power parity.

The recent economic development has also put a positive impact on the various sectors. There has been a significant development in the agricultural, service and industrial sector in the country. Today, to complement the rapid pace of economic growth, the service sector contributes around 54 % of the annual Gross Domestic Product.

Foreign investment and emerging market India

The increase in foreign investment has also cast a favorable effect on the emerging market in India. Due to the increase in demand, well known global companies are investing in the Indian market. The foreign institutional investments (FII) amount has reached around US$ 10 billion mark. In case of the Foreign direct investments (FDI, there has been a significant increase of around 85.1 % from US$ 25.1 billion to US$ 46.5 billion.

The resurgent North-East:

From times immemorial, North East India has been the melting pot of many communities, cultures and faiths. The area consists of seven states commonly known as the "Seven Sisters", including, Arunachal Pradesh, Assam, Meghalaya, Manipur, Mizoram, Nagaland and Tripura, each unique in its cultural and linguistic heritage. The North East is a truly land-locked area, as it shares over 2000 km of border with China, Bhutan, Myanmar and Bangladesh. A narrow 20 km wide piece of land connects it with the rest of India, as the area stands apart with its magical beauty and wide diversity, exemplified with the habitation of over 166 separate tribes.

However, the unique diversity, rich heritage and immense potential of North East have not been successful in making inroads into the enlightened the era of economic development which alone can answer the pressing issue of the region.

Over the decades, when major parts of India have marched to the glory of economic development, North East has been left behind in the course of India's resurgent growth story. According to the Asian Development Bank (ADB), India's north eastern states has suffered from a dearth of investment because of its remote, mountainous location, long distance from markets, high levels of poverty and unemployment, and limited private sector interest. The cobweb of economic backwardness, frustration among youth, conflict of cultural and ethnic identities, mounting insurgency and government apathy to address the basic concerns of people in the region had made India's North East a cocooned island, where benefits of India's high growth trajectory have failed to trickle down.

In Tripura, militancy has declined considerably, whereas in Arunachal Pradesh, Meghalaya and Mizoram insurgency has been subdued. However, in the states of Assam, Manipur and Nagaland, common people continue to face the fury of militants. In Manipur, extortion has emerged as a major obstacle of growth and forced many establishments to shut their shop in the state. In Nagaland, militants are still fighting against security forces and among each other, resulting in massive bloodshed. In the last 13 years, 3,754 people officially got killed in different insurgent related activities in Assam.

But in recent years, there has been a strong wind of change both in terms of private and public initiatives and in terms of projects heading towards North East which has the potential to uplift the poverty-ridden, exploited face of India's North Eastern states.

Government initiatives: Under the 'Look East Policy' of Government of India, the Ministry of Development of North-Eastern Region (DoNER) has been showcasing the strengths of NE to the neighbouring countries so as to set up new industries, attract foreign investments, boost tourism and enhance business and trade.

Infrastructure: Umpteen times it has been proved that the infrastructure development of a region holds the key of its all-round socio-economic development; and North East is no exception in this regard. Recently, the ADB has come forward to assist capital cities of five North Eastern states, including Sikkim, with the objective of improving infrastructure and sanitation. According to a highly-placed ADB official, the bank will provide a loan up to US$ 200 million for the North Eastern Region Capital Cities Development Investment Programme in the state capitals of Meghalaya (Shillong), Mizoram (Aizawl), Nagaland (Kohima), Sikkim (Gangtok) and Tripura (Agartala) that would benefit around 1.2 million people. The project represents one of the largest externally-funded infrastructure investments ever seen in the North East region.

"Ministry of Development of North-Eastern Region has been showcasing its strengths to the neighbouring countries so as to set up new industries, attract foreign investments, boost tourism and enhance business and trade".



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Investment India Market Emerging FDI


  • Wenn Sie diese Meldung sehen, konnt das Bild nicht geladen und dargestellt werden.

    Abhishek Dubey (Autor)

  • Wenn Sie diese Meldung sehen, konnt das Bild nicht geladen und dargestellt werden.

    Dr. Rahil Yusuf Zai (Autor)


Titel: North-East India: An Untapped Emerging Market