Arunachal Pradesh is located in the Northeast of India. It shares its borders with the neighbouring countries of Bhutan in the west, China (Tibet) in the north and northeast, Myanmar in the east and southeast and the Indian states of Assam and Nagaland in the south. The geographic location of the state provides immense opportunities for international trade with South Asian countries through its shared borders with Myanmar, Bhutan and China. Recently, the state received approval for the first border ‘haat’ along the Indo-Myanmar border.
The hilly terrain and abundant rivers make the state a potential powerhouse of the Northeast. The state’s hydropower potential is currently estimated at 57,000 megawatt (MW) or approximately 26 per cent of India’s current power generating capacity.
The gross state domestic product (GSDP) of Arunachal Pradesh increased at a compound annual growth rate (CAGR) of 17.5 per cent between 2004-05 and 2012-13, faster than India’s 15.6 per cent growth. The state has considerable mineral reserves that offer huge potential. Due to its topography, the state has varied agro-climatic conditions suitable for the horticulture of flowers and aromatic and medicinal plants.
Both the state and central governments offer huge fiscal and policy incentives for the development of thrust sectors. The State Industrial Policy, 2008, and Agriculture Policy 2001 support these activities. Additionally, the central government’s North East Industrial and Investment Promotion Policy (NEIIPP), 2007, promotes investment in the state.