The Gist of Yojana: June 2016

The Gist of Yojana: June 2016

• Inclusive Growth and Peace: Levers to Opening up Regional Economy (Free Available)
• STAND UP INDIA SCHEME (Free Available)
• Education & Employment in North East: The Way Forward (Free Available)
• Tribal Development In North-East India (Only For The Subscribed Members)
• North East In Union Budget 2016-17 (Only For The Subscribed Members)

Inclusive Growth and Peace: Levers to Opening up Regional Economy

Although there is much talk about the North-east opening up to South East Asia – a topic of conversation, official approaches and conferences since the early 1990s, -- an important factor in opening up the regional economy surely lies in improved political and trade relations with Bangladesh.

This would enable the NER to play a greater role in South and South East Asia as envisaged by the Prime Minister in his declarations in Dhaka and Guwahati at different times as well as by other leaders before him. The ease of business in slowly improving and a trend setter in this is Tripura, where the state government has got a major Internet Gateway, India’s third, with Bangladesh Government being supportive. Business delegations from across the border are often seen in Agartala, the tiny state’s sleepy capital which is becoming energized. The fact that Tripura a better record of governance than the other North-eastern state and a government committed to delivery of services must be a factor. Insurgency is a thing of the post and much-abhorred Armed Forces Special Powers Act and Disturbed Areas Act were lifted in 2015 by the state government since the state is at peace.

This is a small but incremental step, as in the past, it was nightmare to get official permission to visit Bangladesh: the nearest Bangladeshi consular offices are in Kolkata and Agartala. To get a visa involved a round trip of two or three days and an expense of thousands of rupees.

Yet, despite all this, there are factors which underline the challenges of the Act East Policy and connectivity as well as seeking international investment into the North-eastern region. It is important to face these issues directly rather than talk about cosmetic ideas which paper over major difficulties.

For one, it is difficult to shake off the image of a ‘disturbed’ area, which has a history of 60 years of conflict and insurgency. These are among the reasons why the region remains unattractive to investors despite the government’s hard sell campaign. The Centre’s policy towards the region has been mandated by security concerns and consequently, there remains a trust deficit aggravated by sense of alienation. These have been accentuated by alleged human rights violations by security forces, which have been documented, and by predatory, armed non-State groups.

A major step in unshackling the NER would be to enable access to the Bay of Bengal, braking out of its land-lockedness. This could happen through connecting the rail line from Agartala via Akhaura in Bangladesh to Chittagong Port. Progress on this has been slow. Discussions about them have gone on for at least two decades between the two sides, with policy experts such as the late BG Verghese pushing for such changes.
The National Bamboo Mission has estimated that some 20 million tones to bamboo can be harvested every year and lakhs of people can be employed in this field. But there appears to be a lack of urgency at the ground level. The region still imports almost everything – from razor blades and fish to pencils and food grain, from cars to television sets. It remains essentially a market and not a production centre. Raw produce like fruits, vegetables and even cattle are exported to Bangladesh and Myanmar and there are no major processing units to add value and shelf life to these products.

Another significant challenge lies in the changes climate patterns brought by global weather changes, leading to outmigration to other parts of India. The Brahmaputra Valley is devastated by floods almost every year and in one recent surge, nearly 350 embankments collapsed. Yet, there is hardly any public debate in the Northeast or in the rest of the country about the efficiency of embankments and the need to find alternatives.
In the long run, the challenge of resolving conflict issues between ethnic groups and the State will be significant in several ways, and not just in making the region more attractive to foreign travelers and tourists apart from business (no business group is prepared for the unending strikes and bandhs and cripple the states of the region, for these impact production and profit.

STAND UP INDIA SCHEME

“Stand Up India Scheme”, approved by the Centre promotes entrepreneurship among Scheduled Castes/Schedule Tribes and Women. The scheme provides for composite loans by banks between Rs. 10 lakh and upto Rs. 100 lakh for setting up a new enterprise in the non-farm sector. These loans would be eligible for refinance and credit guarantee cover. There will be a credit guarantee fund of Rs. 5,000 crore for providing guarantee cover for loans under State Up India in next five years. There is also the provision of initial capital of Rs. 500 crore to the corpus in FY 2016-17.

The Action Plan for Startup India envisages setting up of 7 New Research Parks modeled on the Research Park at IIT madras. Indian Institute of Science, Bangalore in Karnataka has been selected for establishment of Research Park in the Action Plan. Similarly, the Action Plan envisages setting-up/scaling-up of 18 Technology Business Incubators (TBI) at NITs/IITs/IIMs etc. NIT Calicut, IISER Thiruvanathapuram and IMM Kozhikode in Kerala have been selected for setting up of Technology Business Incubators.

Education & Employment in North East: The Way Forward

North East, a region consisting of eight states has a literacy rate of 77.76 percent which is higher than the national average of 74.04 per cent as on March 2011. In spite of the higher literacy rate, the education system in the North Eat India is un-organized and suffers from a number of limitations/challenges, especially in the technical field which has caused large number of aspirants of higher education to move outside the region. Largely, the education system is controlled by the State Government which is not at par with the national level. The States are still following traditional mode for imparting education. Such a stereotyped educational structure has not only caused a huge outflow of students from the region, but has also led to a substantial drop – out rate of 50.05 percent students between Class 1 to 8 as compared to the national figure of 40.8 percent during 2011-12. The communal conflicts among the different heterogeneous communities and insurgencies have destroyed hundreds of villages, killed many people and made many homeless and orphans. Many of them are internally displaced, may took the risk to migrate with friends and relatives; and ended up in mega cities like Delhi, Kolkata, Mumbai and Bangalore.

Furthermore, north-eastern states having small and big rivers are ravaged by floods and water logging from time to time. Due to inundation of large areas, there are lots of problem relating to transpiration and communication resulting in absence of source of income. Hence, eligible and qualified students without any job opportunities at home are forced to move out to greener pastures. There is lack of modern facilities like electricity and internet.

In order to reduce migration from the north east to the other parts of the country, three has to be a paradigm shift in the educational system entirely. The focus should be on industry training, quality over quantity, research and encouraging entrepreneurial mindset like what is practiced in advanced states (industry oriented). Companies can also come forward to equip the technical and non-technical institutions under CSR initiative to increase the employability rate.

The presence of institutional problems creates a need for a strategy to promote community based collaterals for the effective credit delivery system to take advantage of the locational advantages. The region is strategically located with access to traditional domestic market of eastern India along with proximity to the major states in the east and adjacent countries such as Bangladesh and Myanmar. The region is also a vantage entry point for the South-East Asian Countries. It is for the financial institutions to explore the opportunities, and help to create employment facilities through their banking transactions.

SEZs may be established within the region to capture the economic advantages, especially for tea, coffee, aromatic and medicinal plants, and horticulture products. A strong R & D support system is a sine – qua non for generating demand – driven technologies which are friendly to small holders. For efficient market system, an effective supply chain model needs to be put in place with the help of specialized institution like IIM Shillong.

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