Industrial Opportunities in the Northeast

North East Industrial and

Investment Promotion

Policy, 2007

NEIIPP, 2007, Sikkim will also be included

the distinction between ‘thrust’ and ‘non-thrust’ industries made in

NEIP, 1997 will be discontinued from 1.4.2007.

Incentives on substantial expansion to be given for expansion not

less than 25% as against 33.5% mentioned in NEIP 1997

100% Excise Duty exemption will be continued, on finished

products made in the North Eastern Region, as was available under

NEIP, 1997

100% Income Tax exemption will continue under NEIIPP, 2007 as

was available under NEIP, 1997.

Capital Investment Subsidy will be enhanced from 15% of the

investment in plant and machinery to 30% and the limit for

automatic approval of subsidy at this rate will be Rs.1.5 crores per

unit, as against Rs.30 lakhs as was available under NEIP, 1997

Interest Subsidy will be made available @ 3% on

working capital loan under NEIIPP, 2007 as was

available under NEIP, 1997.

New industrial units as well as the existing units on

their substantial expansion will be eligible for

reimbursement of 100% insurance premium.

(xi) Incentives for Service/other Sector Industries

I. Service Sector

Incentives for Bio-technology industry

Incentives for Power Generating Industries

Statewise and Financial

Yearwise Investments

Investment in terms of Industrial Entrepreneur Memoranda (IEMs)

filed,Letters of Intent (LOIs) issued and Direct Industrial Licences

issued since November 2003.

Investment Areas

Tripura: the potential sectors are

pharmacy, power sector as cost per unit of power

is Re. 1/unit, natural gas and electric power.

Sikkim: agro based products, it is worlds leading

producer of cardumom, and it is very rich in metals

(copper, lead, zinc, coal, graphite and

limestone), handicraft industry, and leather

industry.

Nagaland: infrastructure sector, furniture. This

state is very rich in mineral and oil reserves. So

there is very huge opportunity in this sector.

Meghalaya: rich in the natural resources. Hugeopportunity incement, plywood, beverage, electronicsindustry.

Assam: Famous for Tea. Huge scope of textileindustry, cement production and silk industry.

Arunachal Pradesh: Hydel powerresources, timber industry, sericulture, oilindustry. Opportunity in automobile industry(CNG distribution).

Mizoram: Electronics and consumergoods, handloom industry, grain milling, gingerprocessing.

Two Faces of the Coin

STRENGTHS WEAKNESSES

Large natural resources and

potential for growth in the

agro-forestry and

horticultural sectors

Large mineral deposits

A vast bio-diversity hot

spot.

Vast water resources

Inadequate development of

basic infrastructure

Geographical isolation and

difficult terrain that reduces

mobility

Lack of capital formation

and proper enterprise-

climate

Slow technology spread

Continuation…

STRENGTHS WEAKNESSES

Proximity to one of world's

fastest-growing economies

A highly literate population.

Rich heritage of

handicrafts/handloom/tribal

artifacts

Strong community spirit

and traditional democratic

system of local self-

government

Absence of a supporting

market structure and

adequate institutional

finance structure

Low level of private sector

investment.

Lack of local agricultural

surplus

Insurgency problems

• Late start

Foreign Investment Dreamland

The gateway to the ASEAN countries.

Both land and water routes could be

made available to investors for export to

East and South East Asia.

Proximity to the SAARC countries

Central Grants to North-East

Inference

State governments have failed to

develop their own financial resources.

More dependent on the Central

government. very weak industrial

sectors and inflated service sectors

Slight reduction in amount of grants for

the year 1997, probably due to effects of

NEIP

What else can be done?

In short, North Eastern India's location

advantage and rich natural resources

provide a backdrop to it's development as a

base for foreign investors

Open up age old trade links of Assam: Build a

four-lane express way through the Stillwell Road

from Ledo to Mytkyina in Myanmar to link up with

Route No. 9 of Trans Asian Highway. In my

estimate only 205 Km of road needs to be built

through the Hukong Valley. It will punch the

insurgents and bring in prosperity and tourism

from prosperous ASEAN and PACIFIC RIM. Cost

$ 1 Bn

Construction up of a aerotropolis near

Doom Dooma, upper Assam. This could be

a refueling, resting and recreation stop for

long distance travelers. As of now, there is

no such place.. The aerotropolis will have

World Class recreation

hubs, education, accommodation, sports

facilities and a satellite IT hub to tap the IT

potential of the NE Region. cost $ 5 Bn

Dredging of the river Brahmaputra and itstributaries: On a rough estimate, some 1.5million hectares can be reclaimed if wedredge and drain the rivers. Canals will beavailable for cheap watertransport, irrigation, run of the river powerturbines to generate energy. NationalWaterways-II will be a reality and we canuse 1.5 Mn hectares of reclaimed land torehabilitate misplaced people from floodprone areas. Cost: $20 Bn