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Stress on SEZs to push border trade

Shillong, Dec. 4: Can the Northeast produce export-related items along international borders to facilitate better trade with its neighbours and slash the expensive transportation cost?

This was one of the questions thrown up today at the inaugural session of the two-day policy meet on Economic and Transport Development in Border Areas in Eastern South Asia here. It was organised by the United Nations Economic and Social Commission for Asia and the Pacific, and the Asian Development Bank, in collaboration with the Meghalaya government.

In a separate development, Meghalaya chief minister Mukul Sangma today petitioned Prime Minister Manmohan Singh to develop rail connectivity from Agia to Badarpur in Assam via Meghalaya along the India-Bangladesh border.

Among others, Sangma said the connectivity would accelerate trade and commerce with neighbouring countries in the “true spirit of the Look East Policy”.

Delivering a special address, North Eastern Council (NEC) member M.P. Bezbaruah stressed on the importance of developing special economic zones (SEZs) along international borders to facilitate trade and commerce between the region and the neighbouring countries.

“Special economic zone is an identity which we badly need. These are areas where we produce what we are good at, such as ginger, turmeric and other spices. Myanmar is keen to import such products,” Bezbaruah said.

Meghalaya is known for its high quality ginger and turmeric. The state producesLakadong turmeric, containing high medicinal value, in Jaintia hills.

A model organic farm for turmeric and ginger has been set up at Umsning in Ri Bhoi district, in technical collaboration with the Central Institute of Horticulture, Nagaland and the International Competence Centre for Organic Agriculture, Bangalore.

Export of spices from the entire Northeast in 2011-12 was around 37,38,597MT, comprising mainly fresh ginger, turmeric and cumin seeds. They were exported to Bangladesh and Myanmar via the land customs stations located at Karimganj in Assam and Moreh in Manipur.

“Can we not produce those in the border areas? Because at the moment, if things have to come all the way to the border, their transportation cost is very high,” the NEC member said.

He also said the transport cost from Guwahati to Imphal was much higher than that from Delhi to Guwahati.

“That is why we cannot be competitive. SEZ is needed. First, we should identify what we are going to sell, and what are our comparative advantages. Once we know that we have comparative advantages in raw materials and things that are of demand in South Asia and beyond, value addition and preservation processing are needed,” Bezbaruah further stated.

However, he said it was important to first develop a concept on where the SEZs shouldbe located in the states.

Meghalaya home minister Roshan Warjri, who was the chief guest, said it was important to develop a “multi-mode” transport system to improve and upscale the market requirements.

The transport system will include sea, air and cable routes, she added.

While stating that the lack of adequate infrastructure in the border areas was hampering the trade links between the Northeast and the neighbouring countries, she said it was important to develop SEZs to facilitate trade and commerce.

Unescap chief economist Nagesh Kumar, while ruing the poor transportation system in the region, said if transportation could be improved, the additional annual trade between the Northeast and its neighbours would increase by $50 billion.

ADB’s senior economist Cuong Minh Nguyen said it was important to develop cross-border transport arrangements in the region.

He said the ADB is supporting South Asia Sub-Regional Economic Cooperation projects amounting to $4.6 million, of which about $2.6 million is funded by the ADB.

In a letter to the Prime Minister, chief minister Mukul Sangma said the rail connectivity from Agia to Badarpur in Assam via Meghalaya along the India-Bangladesh border was important, as “this is an area, which is rich in minerals besides connecting Barak Valley of Assam, Tripura, Mizoram and all the land customs stations”. Sangma requested Singh to take this up as a “national project”.

Business boost

ADB will help expand road connectivity and facilitate trade between the Northeast and its neighbouring countries. The bank is supporting SASEC projects amounting to $4.6 million, of which about $2.6 million is funded by the ADB

Bangladesh, Bhutan, India and Nepal are SASEC countries

SEZ is a geographical region designed to promote export of goods and services, generation of additional economic activity, promotion of investment, creation of employment opportunities and development of infrastructure

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