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13 November, 2019 00:00 00 AM / LAST MODIFIED: 13 November, 2019 12:23:08 AM

Seven sister provinces of India: Markets for Bangladesh goods

Bangladesh government has offered connectivity to the seven sister states during the recent visit of Bangladesh prime minister to Delhi
Md. Joynal Abdin
Seven sister provinces of India: Markets for Bangladesh goods

The seven north-eastern provinces of India namely Arunachal Pradesh, Assam, Manipur‎, Meghalaya‎, Mizoram‎, Nagaland‎ and Tripura share an international border of 5,182 kilometers with neighbouring countries i.e. 1,395 kilometers with Tibet, China in the north, 1,640 kilometers with Myanmar in the east, 1,596 kilometers with Bangladesh in the south-west, 97 kilometers with Nepal in the west, and 455 kilometers with Bhutan in the north-west. These provinces comprise an area of 262,230 square kilometers almost 8 percent of that of India. The total population of Northeast India is 46 million with 68 percent of that living in Assam alone. The literacy rates in the states of the Northeastern region, except those in Arunachal Pradesh and Assam, are higher than the national average of 74 percent.

Seven sister provinces having borders with Bangladesh, Nepal, Bhutan, China and Myanmar seven sisters seem to be the corridor of SAARC and ASEAN plus China. Due to poor infrastructure and vulnerable connectivity due to geographical location in a land-locked region made this part a backward region. To compare with the mainland Indian cities like Delhi, Mumbai, Ahmedabad, Chennai, etc. northeastern parts seem to be neglected. But some recent initiative like Ministry of Development of North Eastern Region, North East Special Infrastructure Development Scheme, North Eastern Council, North Eastern Development Finance Corporation Ltd. is a Public Limited Company providing assistance to micro, small, medium and large enterprises within the northeastern region (NER). Other organizations like North Eastern Regional Agricultural Marketing Corporation Limited (NERAMAC), Sikkim Mining Corporation Limited (SMC) and North Eastern Handlooms and Handicrafts Development Corporation (NEHHDC), and very recent Act East Policy of the Indian government etc. created an inspiration in this part.

Besides the central initiatives each provincial government of the north eastern states took separate initiative to uphold respective economic development through promotion of trade, investment and commerce as well as establishment of regional connectivity with the neighbouring countries like Bangladesh, Myanmar, Nepal and Bhutan. To reduce transportation cost of the international trade they are more than proactive to have transshipment facilities through rail, road and water ways of Bangladesh and use Chittagong and Mongla Ports in this regard. Similar arrangement may be active with Myanmar also to get connected with ASEAN countries. Some recent initiative of Indian as well as provincial government like Vibrant Northeast 2019 held on 19-21 June 2019 at Manipur, the Shillong Dialogue 2019, held on 24-25 October at Meghalaya, and India-Bangladesh Stakeholders’ Meet 2019, held on 22-23 October 2019 at Guwahati, Assam etc. are the examples of their proactive initiatives in this regard.

In response of these initiatives, Bangladesh government has offered connectivity to the seven sister states during the recent visit of Bangladesh prime minister to Delhi. It has political criticism but if Bangladesh can use this access from economic perspective then it could be a win-win deal for both the countries. For example, if Bangladesh gets a justified rate of transshipment tax from each of the northeastern shipment from or to the Chittagong or Mongla Port, and to or from West Bengal to the North Eastern provinces then it could be a great source of revenue for us. Therefore ensuring justified stake from this connectivity deal is primarily important for Bangladesh. Secondarily, this connectivity is in the form of transshipment. That means Indian carriers will carry their goods up to Bangladesh Boarder, then Bangladeshi carriers will carry these goods to the ports or opposite Boarder. Thus transportation sector of Bangladesh namely track, rail, water carrier sector will get an additional scope of earning from this transshipment. Thus we can state that, this connectivity will be trade creating for Bangladesh stakeholders. On the other hand, it will reduce seven sister provincial route to nearest port or main land India up to half of their current distance. Thus they will be beneficial by saving fuel cost up to half of their existing expenditure.

Before implementing this win-win deal, Bangladesh has a task to make local stakeholders prepare for this deal for ensuring this trade creation. Otherwise this may cause trade diversion for Bangladesh too. Every action in international trade has a two way possibilities of trade creation or trade diversion. For example connectivity to north eastern states could create trade for Bangladeshi stakeholders through transshipment tax, transportation earnings, development of distribution network and warehouse earnings. But if we fail to avail reciprocal facilities from the state level government of these provinces to provide easy / low cost / duty free market access for Bangladeshi products to these states. Then our aspiring market access to the seven sister provinces may be beyond reach. Negotiating with provincial governments is important that we can learn from the Teesta River Water Distribution Case. The central government is embraced with Bangladeshi counterpart while the West Bengal provincial government is not ready to sign the deal as per requirement of central government and Bangladesh counterparts. Therefore, Bangladesh government should talk to the seven sister provincial governments to get reciprocal deal from them before implementing connectivity deal to the seven sisters.  In this age of global free market economy (though globalization is suffering from a new weave of protectionism) you are one of these two namely market or marketer. Therefore, if Bangladesh fails to create trade from north east connectivity deal then it will divert our trade and Bangladesh will be a lucrative market for the north eastern businesses. Bangladesh can source many raw materials from the northeast like lime stone, coal, fly ash, tea, spices, medicinal plants, coir, bamboo, rural craft, and tourism, etc. process these to manufacture finished product before exporting to the world or re-export to the northeastern market.

Northeast could be a very good market for our fresh vegetables, fish, sea food, pickles and other consumer goods. But to avail this aspiring market access government has to take the lead to avail this commitment from the north eastern provincial governments, to communicate the facilities to the private sector stakeholders and providing other policy support to prepare the Bangladeshi business communities accordingly. Thus connectivity to the northeast deal could make a win-win deal for both the countries. Otherwise it could make Bangladesh a market for the northeastern businesses instead of being a marketer there. It is the high time for Bangladesh government and relevant stakeholders to decide whether northeast will be a market or marketer for Bangladesh.

The writer is Acting Secretary, Dhaka Chamber of Commerce & Industry (DCCI)





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Editor : M. Shamsur Rahman
Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

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