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Industrial Development & Economic Growth in Nagaland

March, 2018

Nagaland is one of the seven states in the north-east. The state is flanked by Myanmar in the east, Arunachal Pradesh in the north, Assam in the west and Manipur in the south. Nagaland’s agro-climatic conditions favour agriculture, horticulture and forestry, offering immense potential in these areas.

Between 2011-12 and 2016-17, Gross State Domestic Product (GSDP) expanded at a Compound Annual Growth Rate (CAGR) of 9.61 per cent to US$ 3.28 billion whereas the Net State Domestic Product (NSDP) expanded at a CAGR of 8.94 per cent to US$ 2.90 billion between 2005-06 and 2015-16. Agriculture accounts for a significant share in Nagaland’s economy. It contributed 28.42 per cent to the state’s total GSDP during 2016-17. Around 72 per cent of the population is engaged in the agriculture sector.

As of January 2018, Nagaland had total installed power generation capacity of 154.87 MW, of which 123.70 MW was under central sector and 30.67 MW was under state utilities. Of the total installed power generation capacity, 70.33 MW was contributed by thermal, 53.37 MW by hydro and 31.17 MW by renewable energy. As of August 2017, all villages in the state had electricity supply.

The state has considerable resources of natural minerals, petroleum and hydropower. Nagaland has around 600 million metric tonnes (MT) of crude oil and more than 20 million tonnes (MT) of hydrocarbon reserves, which are unexploited. Moreover, the state has 315 MT of coal reserves and 1,038 MT of limestone reserves. Nagaland's estimated hydropower generation potential is 1,574 megawatt (MW), while the installed capacity is 53.37 MW as of January 2018, presenting huge investment opportunities.

Nagaland Industrial Development Corporation (NIDC) is responsible for the development of industrial infrastructure in the state.

Promoted by NIDC, the Export Promotion Industrial Park (EPIP) at Dimapur has received formal approval as a special economic zone (SEZ) for agro and food processing. A proposed multi-product SEZ spread across 400 hectares in Dimapur has received formal approval.

The following are some of the major initiatives taken by the government to promote Nagaland as an investment destination:

  • In 2017-18 state budget, US$ 61.99 million was allocated by the state government for the development of roads and bridges in Nagaland.
  • During the 2017-18 budget, the government proposed to allocate US$ 95.76 million for medical and public health in the state.
  • In April 2017, the Ministry of Urban Development (MoUD) has approved the State Annual Action Plans (SAAPs) for Nagaland for the period of 2017 – 2020. The plans are estimated to cost around US$ 6.69 million under the Atal Mission for Rejuvenation and Urban Transformation (AMRUT).
  • The state provides institutional support through various central and state government agencies viz., North East Council, Ministry of Development of North Eastern Region and Nagaland Industrial Development Council.
  • Ministry of Tourism, Government of India, has included 12 villages in Nagaland under the rural tourism scheme in order to promote traditional rural art, craft, textile and culture.
  • The state has established various Micro, Small and Medium Enterprises (MSME) industrial clusters, mainly in Kohima, Wokha and Mokokchung districts.
  • The state government has proposed an outlay of around US$ 88.92 million for agriculture and allied sectors development during the state budget 2017-18.
  • To exploit the huge potential of hydropower generation in the villages, the New and Renewable Energy Department of the Government of Nagaland has identified 21 feasible sites for hydro projects at the micro and mini levels.
  • An Industrial Growth Centre (IGC) has been developed in Ganeshnagar near Dimapur. It has supporting infrastructure such as water supply systems, banks, post offices, police stations, etc.

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