North East registers trade deficit with Bangladesh, trade surplus with China
Our Correspondent
Kohima | September 25
The North East of the subcontinent is one of the least developed regions of the Indian Union. Of late, however, it has been realized that the region is the “missing link” between India and South East Asia. The region shares a long international border with Bangladesh, Bhutan, China, Myanmar and Nepal.
This was stated in the publication entitled ‘Harnessing the potential for cross-border trade between North East India and its neighboring countries’ prepared by CUTS International (Consumer Unity & Trust Society) as a ‘knowledge partner’ of Federation of Indian Chamber of Commerce & Industry (FICCI) for the recently concluded North East Connectivity Summit here.
The publication stated that all these countries are important trading partners of India and that opens huge trade potential for North East India.
However, more than 5000 km of international border that lies along the North East were recently more in news for cross-country contentions. Collaborative economic action through cross-border trade was revived at the wake of India’s Act East Policy, it stated.
However, such transition from an economically backward and security sensitive region to a trade hub and a bridge to South East Asia is yet to be realized despite significant government-led attempts.
“Therefore, at this juncture it becomes important to understand the specific problems of the region and extend precise policy prescription towards the same including greater private sector participation to realize this goal,” it stated.
Current scenario on
cross-border trade
Over the last several years cross border trade between North East India and its bordering countries has increased by more than 50 per cent. Paradoxically, the region registers a trade deficit with Bangladesh and a trade surplus with China, which is diametrically opposite from the national level trade scenario.
Another important aspect of the cross border trade in the region is that over the years the share of trade with Bangladesh has declined owing to increased trade volume with other neighboring nations.
“This characteristic strengthens the trade portfolio of North East Indian states, with declining dependency on any specific bordering country. Apart from Nepal, with all other bordering countries, North East India shares favorable trade routes and more than 96 per cent of its cross border trade is happening through Land Custom Stations (LCSs),” it stated.
Scope for trade enhancement
In this paper, CUTS International has identified a number of products, such as fresh and processed fruits, other horticultural items, floricultural items, handloom and handicrafts, tea, coffee, rice, local herbs and herbal products, jute products, essential oil, mineral like coal and limestone, raw cotton, raw and processed rubber, handmade paper as possible tradable products between the North East India and neighboring countries.
It stated that there is huge potential of strengthening regional value chains by reaching out to its immediate neighbors and other countries in India’s extended neighborhood such as those in South East Asia.
“This will further the trade possibility and upon the realization of on-going and future connectivity initiatives might propel the growth engine for the region,” it maintained.
