North Eastern Region (NER) Problems and Improvements in Service Sector here

Problems of North Eastern Region (NER) and Measures to Improve Service Sector in this Region

The ‘Look East’ policy established in the year 1991 paved the way for the ‘Act East’ policy of the year 2015. The ‘Act East policy aims to promote economic, cultural, and strategic cooperation with countries in the Asia-Pacific region. This also includes providing better ‘connectivity’ to the North Eastern Region (NER) of India with the bordering countries.

Contrary to global experience, the border districts of South Asia, especially in the eastern region, have been significantly backward compared to other districts. There are several studies that show that lack of adequate transport and connectivity is acting as a major trade barrier in the Northeast region, especially the ‘Chicken Neck’ region of the Siliguri Corridor.

Several districts in the region, bordering Bangladesh, Bhutan, and Nepal, were classified as ‘backward’ areas by the erstwhile Planning Commission. Thus, there is a need for proper focus on the capacity of the service sector in North Bengal and the North Eastern States. While it can be challenging to ponder over the potential of the services sector during a pandemic, it is undoubtedly important to remain proactive and forward-looking.

Development Problems in the North Eastern Region

Limited Areas of Development: Economic activities in the northeastern states are limited to a few selected areas, as a result of which this vast and vast area remains inaccessible and backward even today.

Prolonged revolts and socio-political conflicts result in economic challenges and social disorder.

Regular funds are channeled by the central government to the local political leadership through various schemes, although this money has been used on the ground, which indirectly discourages local initiatives to raise funds for the economic rejuvenation of the region. 

Lack of economic infrastructures such as transport, communication, and market access has also hindered industrialization in the region.

The lack of adequate infrastructure has hindered industrialization, while the existing industrialization has not been able to develop due to poor infrastructure, which creates a vicious circle.

Lack of connectivity with the rest of the country is also a major challenge. The development of this region The North Eastern Region (NER) communication links concentrated only in the upper Brahmaputra valley.

Low agricultural production: Even today in the hilly areas of the land, primitive farming methods like slash and burn are prevalent.

The single cropping system in the plains fails to produce enough food grains even for local consumption.

way ahead

Producer Services: Border Districts should develop a perspective plan identifying their comparative advantages and integrate them with schemes like ‘District Export Hubs’ and ‘One District-One Product’ Must be coordinated.

The expansion of key sectors will require significant growth of the ‘productive services’ sectors, which include management services, research and development, financial and accounting services, and marketing.

Financial Services: Apart from Sikkim, the entire North-Eastern region is lagging behind in terms of financial inclusion. The financial services sector can drive the regional development of the Northeast and will have both efficiency and fairness implications. Innovations related to the ‘fintech’ sector can also be of great importance.

ICT Connectivity: The nature of ICT i.e. Information and Communication Technology sector is also similar to that of the financial services sector. There is a lack of adequate ICT connectivity due to the geographical location of the North Eastern Region, which hinders the development opportunities of the region.

If India can take advantage of Bangladesh’s submarine cable network, the benefits of digital connectivity can be extended to the Northeast region through a combination of optical fiber, satellite, and microwave technologies.

Cooperation, trade, and innovation in the Northeast region will also help our neighboring countries.

Tourism: Tourism can be promoted in The North Eastern Region (NER) with better connectivity. Along with the religious and historical sites of the region, its natural beauty can be helpful in promoting tourism.

It has been found in the study that many citizens of Nepal living in the border areas come to Siliguri for shopping. Daily trips for shopping/picnics from neighboring countries can be encouraged and monetized.

Travels—both short-term and long-term—can generate overseas revenue. In such a situation, the Haats / Bazaars organized on the border between India and Bangladesh should be encouraged.

Education: Quality boarding schools are being run in the Siliguri region, which is doing very important work for the students of the border districts.

Similar efforts can be made in other districts of the North-Eastern region also. Higher education can be developed as a potential area of ​​service export through research institutes and ‘Edtech’ companies.

Logistics: The existing infrastructural investments will increase the demand for logistics services. India is developing several airports in the region.

The ‘Bagdogra Airport’ (Darjeeling) is the only international airport in North Bengal and is in close proximity to several districts of Bangladesh and Nepal.


The North Eastern Region (NER) offers vast potential in terms of the development of the service sector. The unique nature of each of the border districts needs to be identified, developed and enhanced, so as to promote sustainable development and progress in these areas.

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