BCIM Corridor could change North-East India’s fortune

Bangladesh, China, India and Myanmar-Economic Corridor (BCIM-EC) is a sub-regional grouping that seeks to deepen friendly cooperation among the four member nations and connect South Asia with South-East and East Asia by building multi-modal connectivity, harnessing economic complementaries and boosting people-to-people relations. The BCIM region is one of the richest in the world in terms of resources. The region covers 9% of the world's total area, 7.3% of the global gross domestic product and involves 440 million people. The Indian business leaders especially in North East believe that the proposed economic corridor has huge prospects in the arena of trade, investment, energy, transport and tourism.

The primary focus of the BCIM is to facilitate trade and connectivity between the landlocked and underdeveloped South-Western parts of China and the North-Eastern region of India. The proposed economic corridor will originate from Kunming in China's Yunnan province and pass through Yangon and Mandalay in Myanmar, Chittagong-Dhaka-Sylhet in Bangladesh before entering North Eastern states, Bihar, Bengal and ending in Kolkata.

Efforts to revive the Silk Road

In February 2012, the governments of all the four countries approved the proposal to construct a 2,800 km highway akin to the path used by the merchants centuries ago. The leaders of the four nations are trying to revive the ancient "Southern Silk Road" which emerged as the shortest journey between China and India and served as a highway for Chinese merchants carrying gold and silver in the12th century.

A government-sponsored car rally was organised in February 2013 along the route to showcase the proposal's immense future potentials. The South Asian and Chinese leaders want to transform the route into a robust economic corridor by reviving the old commercial ties. The economic benefits of the BCIM-EC are huge – access to several booming markets in Southeast Asia, improvement of transport infrastructure and setting up of industrial zones. These initiatives are bound to enhance cross-border flow of goods and people, lessen overland trade bottlenecks and expand the volume of inter-regional trade.

Framework of cooperation

The four member nations emphasised the need to quickly improve physical connectivity in the region in the first Joint Working Group (JWG) meeting on December 18-19, 2013 in the Chinese city of Kunming, the provincial capital of Yunnan which shares border with Myanmar. In order to boost regional connectivity, the four nations decided to build multi-modal transport – road, rail, water ways and air ways, infrastructure. They also underscored the need for cooperation in energy and power sectors to tap local resources. Moreover, the development of telecommunication network along the corridor was emphasised. For promoting inter-regional investment, the member nations agreed to broaden participation of both public and private sectors.

To improve the livelihood of people and reduce poverty along the corridor, the member nations sought cooperation in agriculture and environment-friendly industries to create a basis for sustainable development. They agreed to enhance exchanges and cooperation in areas such as education, science and technology, culture, healthcare and sports as part of human resource development in the region. Furthermore, infrastructure facilities would be up graded and the tourism potential of the region would be explored to create a BCIM tourism circle.

North-East's potential

Initially, the four countries will identify realistic and achievable infrastructure projects to up grade physical connectivity. The implementation of several ambitious projects and consequent linking of all the four countries will finally open up the entire North-Eastern region to Southeast and East Asia and transform it into a robust trade zone. Under the BCIM initiative, the North-East in general and Manipur and Barak valley of Assam in particular are projected as the major beneficiaries since the proposed economic corridor will pass through these states. Currently, most of the landlocked states of the region have to bear higher transportation costs for not having easy access to sea ports.

The lack of proper infrastructural facilities has resulted in the economic isolation of the region.
It can not be denied that the Indian ruling elites more or less ignored the North-Eastern part of the country for several decades. An over-emphasis on security and strategic aspects involving North-East has been the dominating feature of the national policy making. For several decades, the Centre did not devise a long-term development strategy for this sensitive border region where some peripheral areas are still socio-economically very backward and almost inaccessible in terms of transport and communication facilities.

Despite being endowed with abundant resources, the union government hardly made serious attempts to properly utilise those to bring about economic development and prosperity in the region. North-East has gained prominence only after the articulation of Look East Policy (LEP) in the early 1990s. The current National Democratic Alliance (NDA) government has rechristened LEP as "Act East" initiative. The region is now considered as India's gateway to Southeast and East Asia. Among all the North-Eastern states, only Assam has an industrial base and elaborate transport network. It is the largest economy contributing about 60% of North-East's GDP. The state produces more than 65% of country's tea which is globally appreciated for its aroma.

Connectivity projects linking North East gains momentum

Another constraint for North-East to expand trade and commercial ties with the neighbouring countries is infrastructural bottlenecks of the region. Some major projects have been launched since the late 1990s to improve the overall infrastructural facilities in the region. But the people of North-East are yet to be benefited from those projects as their implementation has remained very slow. Factors such as seemingly-unending insurgency, periodic ethnic clashes and rampant corruption have also stood in the way of speedy completion of the projects.

There are many plans to link India, especially it's North-East, with Southeast and East Asia through Myanmar. Some of them include: India-Myanmar-Thailand Trilateral Highway, Mekong-India Economic Corridor, New Delhi- Moreh- Hanoi rail link. India has taken the initiative of developing Kaladan transport corridor which connects North East with Sitwee port in Myanmar. India, Myanmar and Thailand are set ink a Bangladesh, Bhutan, India and Nepal (BBIN) Motor Vehicles Agreement (MVA) like pact to facilitate North East's economic integration with the robust markets of Association of South East Asian Nations (ASEAN).

The introduction of Guwahati-Shillong-Sylhet-Dhaka and Agartala-Dhaka-Kolkata bus services and the Awami League government's granting of transit access to Chittagong and Mongla ports during Prime Minister Narendra Modi's landmark visit to Dhaka in June 2015 would significantly contribute towards augmenting trade, investment and broadening people-to-people relations between North East India and Bangladesh. Cross-border connectivity received further impetus following the opening of Imphal-Mandalay air and bus routes. The operationalisation of these transport linkages assumes significance as both Bangladesh and Myanmar hold key to India's ambitious "Act East" initiative.

Plans are underway to set up 2000 acres Special Economic Zone at Moreh in Manipur. Similar schemes have been proposed at Sitwee in Myanmar and Champai in Mizoram. Reports suggest that Asian Development Bank may provide financial assistance for up grading Imphal-Moreh section of National Highway-39 and the road between Silchar and Imphal. The World Bank is funding the up gradation of the highway that connects Aizwal with India-Myanmar border.

On May 27, India's Prime Minister Narendra Modi inaugurated Silchar-Jiribam rail route. Work is in progress to extend it to Imphal. The Jiribam-Imphal rail route is likely to be completed by 2018. The broad-gauge conversion project of the Silchar-Lumding section was completed in March 2015. In addition to Barak valley, states like Mizoram and Tripura are heavily dependent on this railway link for supply of essential commodities.

The NDA government has also assured the people of these states that the proposed East-West Corridor linking Silchar with Gujarat would be accorded top priority. Once these roads and railway lines become operational and inter-linkages are established with the proposed BCIM corridor, economic resurgence will take place in North East.

North-East's commercial ties with neighbours

The North-Eastern states maintain trade and commercial ties mainly with three neighbouring countries – Bhutan, Bangladesh and Myanmar. Assam shares 267 km of the total 699 km of India-Bhutan border. The tiny South Asian nation depends on Assam and North Bengal's Joygaon for trade and supply of essential commodities. With the signing of the BBIN MVA, some of the major concerns of the two landlocked Himalayan nations – Nepal and Bhutan have been addressed.

The three states of North East – Assam, Tripura and Meghalaya, have commercial ties with neighbouring Bangladesh. Some of the key items of trade between North East and Bangladesh include cement, readymade garments, processed food, bicycles and plastic products. Both the Bangladeshis and the North Eastern business communities are upbeat over the vast scope for enhancing bilateral trade given the geographical proximity and resource potential of the two countries.

There is enough scope for investment and joint ventures in sectors like horticulture, rubber, bamboo, hydro-electricity, agro and food processing, handicrafts and handloom. The pacts related to trade, economic corporation and connectivity signed between the two BCIM members – India and Bangladesh – during Modi's visit to Dhaka would be hugely beneficial for North East.

Trade is a vital component of India-Myanmar relations. India signed a trade agreement with Myanmar in January 1994. Currently, border trade is carried through the designated custom ports at Moreh (in Manipur) and Tamu (in Myanmar) and Champai (in Mizoram) and Rhi (in Myanmar). The commercial ties between North East and Myanmar is also characterised by high informal trade.

The two neighbouring nations have enough potential for trade and commerce in the areas such as bamboo and wood products, pharmaceuticals, rubber products, food items, refined petroleum products, other non-metallic mineral products, cement, and textile items. Besides, there are scopes for cooperation in the services sectors like health, tourism, education, transport and communication.

The four member countries are also exploring the ways for developing tourism in the BCIM region. Ecotourism will grow once the physical connectivity is established. The region's rich bio-diversity and beautiful landscapes especially in Myanmar and Yunnan province of China are perfect ingredients for a creating a BCIM tourist circuit. The recent opening of Imphal-Mandalay air and bus services is a significant step in that direction.

A roadmap for rejuvenating North-East

Schemes envisaged under the BCIM-EC would further increase cross-border movement of goods, services and people. The North Eastern states have shown keen interest in the BCIM initiative. A few workshops and conclaves had already been organised to explore the possibilities of boosting trade and economic cooperation between North East and BCIM countries. North East has tremendous resource potential. But the Centre did not make any serious effort for the optimal utilisation of those resources and consequently, the region has remained marginalised for long. The improvement of the security scenario in India's North East, which has been facing chronic insurgency, ethnic clashes and blockades for many decades, is a prerequisite for the region's economic integration with the fastest growing markets of Southeast and East Asia.

The BCIM corridor will pass through Manipur, a state plagued by ethnic militancy and narco-terrorism. Both the union and state governments should coordinate efforts to address the problems of the various ethnic groups, including Meitei, and initiate steps towards organising peace dialogue with the insurgent outfits active in the state. In order to broaden North East's engagement with the neighbouring nations, the restoration of peace and stability in Manipur, which serves as India's gateway to ASEAN, is immediately required.

The BCIM members also need to quickly resolve key issues like removal of non-tariff barriers, liberalisation and harmonisation of trade procedures and initiate different trade facilitation measures taking North-East into consideration. To bring about economic prosperity in problem-ridden North-East, massive infusion of foreign capital is needed and the BCIM has been designed to accomplish it. The plans for creating industrial parks and Special Economic Zones along the proposed BCIM highway could make North-East a hub of trade, transit and connectivity.