Even from a trade perspective, routing all cargo destined for the North East through this corridor causes significant transportation delays and cost overheads. India attempted negotiating with Bangladesh since the 1970s for transit access from the Bay of Bengal to these states, but this has met with limited success only.

In the very near future the North East will have an alternative route via Myanmar. Landlocked North East will, within the next few years have access to the sea through the ambitious Kaladan Multi Modal Transport Project which aims to connect Sittwe (Akyab) in Myanmar to Lawngtlai in the southern part of Mizoram. The project will not only lessen the dependence on the chicken neck but will boost trade and commerce in the region and Mizoram can look forward to being a major player in trade and commerce in the entire region. The project has the potential to boost the economy of the region as it will provide access to Myanmar’s vast unexplored natural resources. It can also help in the export of resources from the region to countries in South East Asia and further ahead. In the light of the Look East Policy, the project assumes special significance as it is one of the major connectivity initiatives that have the potential to open access in terms of trade and commerce to the region and increase international trade. At the same time, it will also be an alternate route for transport of goods from the eastern sea board to North East India.

Look East Policy

One of India’s landmark foreign policies that emerged post Cold War and post liberalization of the economy in the 1990s which has to some extent paid tangible economic dividends is the Look East Policy.  The increase in trade between India and the Association of South East Asian Nations (ASEAN) countries - Brunei, Cambodia, Indonesia, Lao, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam from US$ 7billion in 2000 to US$ 68.4 billion in 2011 maybe a clear indicator of the economic benefits of this Policy. This trade now constitutes almost 9 per cent of India’s global trade. Indian investments in ASEAN as well as ASEAN investments in India have also registered significant growth. The Free Trade Agreement between India and ASEAN as well as India and the ASEAN member countries have created an enabling environment for the smooth development of multilateral as well as bilateral economic cooperation.

India - ASEAN trade mainly flows through sea routes and so thereby coastal states like Tamil Nadu, Andhra Pradesh and West Bengal have been the principal beneficiaries of this Policy which has propelled growth in them. The Policy seems to have bypassed the North East since economic returns to the region have been largely negligible. This fact has been well acknowledged by an ambitious landmark document for growth and development of the Region – the North Eastern Vision Document 2020 which was unveiled in 2008 by Prime Minister Manmohan Singh. This Document stresses on the need of the Look East Policy to shift focus so that South East Asia begins from North East India and the region can play the role of an arrowhead in furthering the Policy. An entire chapter of the Document has been dedicated to the North East Perspective of the Look East Policy.

Over the years, some important aspects of this perspective of the Look East Policy that have emerged are:

1. Connectivity and Physical infrastructure to facilitate trade
2. Trade and investment protocols
3. Shortfalls in operationalisation of existing assets and facilities
4. Soft aspects of bi-lateral / multi-lateral relationships such as in tourism and enhanced people to people interaction through sports, culture, academic and medical research etc.

In the immediate near future, it is connectivity and physical infrastructure that are the most important and in some ways hold the key to the economic integration of the region with the rest of the country as well as with adjoining countries so that the Policy can make a mark in the economic development of the region and bring in substantial benefits. Given that the fortunes of over 38 million people of the NER depend on good relations with India’s neighbours, the bureaucratic and defence - dominated approach to relationships must give way to the one based on mutual economic gains. It is encouraging to note that during the last two years there has been a qualitative change in the relationship with the neighbouring countries, particularly the larger countries of Bangladesh, China and Myanmar. Improved relations can accelerate the penetration and enhance the success of the Policy in the region.
 
The Kaladan Multi Modal Transport Project

The Framework Agreement and Protocols for the implementation of the Kaladan Multi Modal Transit Transport Project were signed in April, 2008. The Project envisages connectivity between Indian ports on the eastern seaboard and Sittwe Port in Myanmar and then through riverine transport and road to Mizoram. This would include dredging of River Kaladan from Sittwe to Setpyitpyin (Kaletwa), construction of a river port at Paletwa and construction of a highway between Kaletwa and Mizoram. The Kaladan project has been approved at a total cost of `535.91 crore. The Ministry of External Affairs is the nodal agency representing India for the project. India’s Essar Group was awarded contracts for construction of the seaport and the riverine port in Myanmar.

The distance from Kolkata to Sittwe is about 539 kms by sea. Sittwe to Setpyitpyin (Kaletwa) a distance of about 225 kms is to be via Inland Water Transport on river Kaladan. Setpyitpyin to India - Myanmar border is to have a highway of 62 kilometres. From this point to Lawngtlai in southern Mizoram is about 95 kms. Mizoram PWD is implementing the construction of a 2 lane highway on this sector. The Project cost is about 550 crores which is being met through the SARDP - NE.

The completion of the Project will open up possibilities for better connectivity and movement of goods between India and Myanmar. The Project will elevate Mizoram from a land locked state with negligible trade to an important trading partner and facilitator of the border trade with South - East Asian nations very near in the future.

Pratap Chettri