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The Economy of India's Northeast

Geography and the Siliguri Corridor

How the Northeast's location, connected to the rest of India by a narrow strip of land, shapes its trade, transport costs and development.

India’s Northeast includes eight states: Assam, Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Tripura and Sikkim. Together they cover a large area but hold a small share of India’s population.

The Siliguri corridor

The region connects to the rest of India through the Siliguri corridor in West Bengal, sometimes called the “Chicken’s Neck”, only around 20 to 22 kilometres wide at its narrowest. Most road and rail traffic passes through it.

Surrounded by other countries

The Northeast shares long borders with China, Myanmar, Bangladesh, Bhutan and Nepal, but only a narrow link to India itself. Before 1947, it was connected to the sea through Chittagong and routes in what is now Bangladesh. Partition cut these routes.

Economic consequences

  • High transport costs for goods coming in and going out.
  • Difficult terrain: hills, rivers and heavy rainfall make roads and railways costly.
  • Distance from markets and ports.
  • Limited industry compared with other regions.

Improving connectivity

  • New railway lines reaching state capitals.
  • Bridges over the Brahmaputra, such as the Bogibeel bridge (2018) and the Dhola-Sadiya bridge (2017).
  • Airports under regional schemes.
  • Transit agreements with Bangladesh to use its ports and roads.

Why it matters

Better connectivity could turn the Northeast into a gateway to Southeast Asia, in line with India’s Act East policy.

The long route

Before transit agreements, goods from Kolkata to Agartala had to travel around 1,600 kilometres through the Siliguri corridor. Routes through Bangladesh can cut this to a few hundred kilometres.

Thinking the Northeast is isolated by choice

Partition cut its natural routes to the sea, and difficult terrain raises costs.

Key takeaways
  • The Northeast has eight states linked to India by the narrow Siliguri corridor.
  • It borders China, Myanmar, Bangladesh, Bhutan and Nepal.
  • Partition cut routes to the sea, raising transport costs.
  • Bridges, railways and transit through Bangladesh aim to improve connectivity.
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