Cross Border Trade

Cross Border Trade

The Northeastern Region of India comprises of the states of Assam, Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura. The strategic importance of the region for the country is that while the region is connected to the rest of the country only through a narrow corridor popularly known as Chicken’s neck corridor, the region shares it border to as many as five neighbouring countries Bangladesh, Bhutan, China, Myanmar and Nepal and has agreements of overland trade with these countries through Land Custom Stations notified under Section 7 of the Customs Act, 1962. While for trading through LCSs situated on Bangladesh and Bhutan border, there is a Free Trade Agreement (SAFTA), Border Trade Agreement have been entered into with China and Myanmar

North Eastern Region is unique in terms of the economic opportunities it offers. About 98 per cent of the region’s borders form India’s international boundaries; it shares borders with China, Bangladesh, Bhutan and Myanmar. Given its strategic location, the region can be developed and promoted as a base for India’s growing economic links not only with the Association of Southeast .Asian Nations (ASEAN) but also with neighboring countries, viz. Bangladesh, Bhutan, and Nepal.

Over the past several years, India has been a member of a number of regional and sub-regional initiatives that countries in South and South East Asia have taken to deepen their economic integration. These include the South Asian Free Trade Agreement (SAFTA), which is the first step towards an eventual South Asian Economic Union, the Bay of Bengal Initiative for Multi-sectoral Technical and Economic Cooperation (BIMSTEC) and the Asia-Pacific Trade Agreement (APTA). Further, as a part of its “Look East” policy, India has increased its engagements with the members of the ASEAN and countries belonging to the East Asia Summit (EAS). As is clear from Figure 1, the centrality of the NER is critical in effectively pursuing these initiatives which can result in prosperity of the Entire South East Asian Economy.

But despite the growth in Bilateral trade, the North Eastern Region is struggling with problems like unemployment, lack of livelihood resulting in militancy and other law & order problems. Experts, thus, argue that the Northeast must be allowed to play the arrow-head role in the further evolution of India’s look-east policy(LEP-NE). Even though Look East Policy (LEP) had been part of India’s Foreign Policy since early 1990s, a North East perspective emerged at the official level only in October, 2007 in a meeting of the then Foreign Minister, Shri Pranab Mukherjee and the Chief Ministers of the North Eastern States on the initiative of the Ministry of DONER. The Look East Policy is an integral part of North Eastern Region Vision 2020 – a roadmap for development of the Region dedicated by the Hon‟ble Prime Minister to the people of the North East in July, 2008.

Over the years, these aspects of LEP-NE have emerged:

Connectivity and Physical infrastructure to facilitate trade
Trade and investment protocols
Shortfalls in operationalisation of existing assets, facilities and challenges .
Soft aspects of bi-lateral / multi-lateral relationships such as in tourism and enhanced people to people interaction through sports, culture, academic and medical research etc.
Prime Minister Narendra Modi underscored the centrality of the 10-nation ASEAN bloc in India’s plan to scale up its ‘Look East’ policy to an upgraded ‘Act Easy Policy’. Externally, India’s ‘Look East Policy’ has become ‘Act East Policy’.

Out of all the neibouring countries , Bangladesh & Myanmar are most important for the North Eastern Region because of their Strategic Location. We can have a look into the Current Scenario of Trade with these two countries.

For more information contact
iccner@indianchamber.net

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