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. Huge opportunity in cement, plywood, beverage, electronics industry.  Assam: Famous for Tea. Huge scope of textile industry, cement production and silk industry.  Arunachal Pradesh: Hydel power resources, timber industry, sericulture, oil industry. Opportunity in automobile industry (CNG distribution).  Mizoram: Electronics and consumer goods, handloom industry, grain milling, ginger processing.

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 spot. bio-diversity hot

Inadequate development of basic infrastructure Geographical isolation and difficult terrain that reduces mobility Lack of capital formation and proper enterpriseclimate Slow technology spread

Vast water resources

Continuation…
STRENGTHS

WEAKNESSES

Proximity to one of world's fastest-growing economies A highly literate population. Rich heritage of handicrafts/handloom/tribal artifacts

Absence of a supporting market structure and adequate institutional finance structure Low level of private sector investment.

 Lack of local agricultural Strong community spirit surplus and traditional democratic system of local self-  Insurgency problems government • 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 its tributaries: On a rough estimate, some 1.5 million hectares can be reclaimed if we dredge and drain the rivers. Canals will be available for cheap water transport, irrigation, run of the river power turbines to generate energy. National Waterways-II will be a reality and we can use 1.5 Mn hectares of reclaimed land to rehabilitate misplaced people from flood prone areas. Cost: $20 Bn