Strengthening Logistics & Infrastructure in Northeast India

For the longest time, the Northeast region of India remained isolated from the mainland due to its geographical location, hilly terrain, and lack of economic development. This had limited trade, economic development, and access to essential services, making the region dependent and vulnerable to disruptions. However, the past few decades has been instrumental for the growth of Northeast as there has been a growing recognition of its strategic importance, untapped natural resources, and potential for development.

Existing Infrastructure Landscape

At present, road connectivity remains the primary mode of movement between NE and the Indian mainland. While the railway sector has seen increased investment, at present, not all northeastern states are connected with each other or to the mainland. In fact, it was only recently that Mizoram got its first railway line. This is part of the larger plan to expand railway infrastructure in the North-East. Currently, 12 railway projects costing ₹69,342 crore have been sanctioned for the region. 

The North-East is also a part of the Regional Connectivity Scheme – UDAN (“Ude Desh ka Aam Nagrik”), which aims to de-democratize aviation and make flying accessible and affordable for all. UDAN 4.0, launched in 2020, focused heavily on this and enhanced helicopter services in difficult terrain. However, states like Mizoram, Sikkim, and Arunachal Pradesh still face limited cargo infrastructure, restricting air freight movements. 

Waterways in the Northeast have seen very limited operationalization and development. States like Mizoram, Sikkim, and Arunachal Pradesh currently lack access to inland waterways logistics. While the NW-2 is functional, the utilization of other declared natural waterways in the region remains limited.

Persistent Challenges 

The development of efficient logistic infrastructure is essential to unlocking the economic potential of North-East India. However, these challenges persist even today and must be resolved urgently to ensure proper development of logistics in the North-East region. 

• Infrastructure bottlenecks

Poor road conditions, and climate-vulnerable roads result in long delays, product aging, and losses. The high transportation costs further inflate product prices compared to mainland India. North-Eastern states also lack warehousing and cold storage facilities, which contribute to consignment rejections, especially for perishable and electrical items. Absence of seamless connectivity to ports also hampers the export potential in the North-East. 

• Weather and climate impact.

Weather in these states is highly erratic with extreme monsoons leading to constant flooding. This leads to disruption in road connectivity, and impacts transport of essential commodities and products. The Siliguri corridor, or ‘Chicken’s Neck’, remains a critical lifeline which connects the North-East to the mainland. However, it remains prone to landslides and weather-induced blockages. Logistic policies often fail to account for seasonal peaks and disruptions tied to the region’s unique geography.

• Geopolitical Dependencies 

Considering that the majority of the Northeast is surrounded by other countries like Bangladesh and China, states like Tripura remain dependent on Bangladesh for transit routes, exposing it to structural vulnerabilities. With Bangladesh connectivity projects currently stalled, there is a pressing need for alternative India-controlled transport corridors to Southeast Asian markets.

Recommendations and Strategic Focus 

Since its launch, the Confederation of Indian Industries (CII) has been facilitating structured dialogues with state government industry leaders and logistic experts across the region, and state-wide consultations. Based on this, its report on actionable outcomes for logistic development in NE has made the following recommendations:

• Infrastructure and policy alignment.

The report highlights the need to expedite national highway projects, integrated logistic hubs, and multimodal infrastructure to ensure seamless movement of goods. It is also imperative that the logistic policies are aligned with regional needs and streamline land acquisition processes for critical projects. Private sectors should also be encouraged to utilize CSR funds to support logistics and infrastructure development, especially in remote areas. 

• Technology-driven solutions

Digital platforms to connect producers, particularly farmers, and national export markets should be explored. Promote the Digital Access Code (DAC) or similar geo-location tools that can help in enabling commerce and efficient last-mile delivery, especially in hilly and remote areas. Warehouse infrastructure should also be upgraded with a modern information system for real-time tracking and inventory management.

• Alternate connectivity 

Strategic alternate trade routes, independent of Bangladesh, should be developed to safeguard against geopolitical disruptions, while also strengthening air travel infrastructure in underserved states like Mizoram and Sikkim to support Agri-exports. Underutilized waterways should also be explored where viable, with targeted infrastructure investments.