LEP, investment and profit sharing
- The Sangai Express Editorial :: July 18, 2014 -

The Government of India’s much talked about Look East Policy (LEP) is quite successful in generating popular excitement, tall expectations which were unimaginable till the last decade, dreams for sudden economic growth and highly standardized connectivity between India’s remote North East corner with the outside world, particularly South and South East Asia.

LEP looks and sounds very impressive, and many see LEP as a launch pad for the region’s economic growth, which is relatively quite backward at the moment.

In short, many view LEP as stairway to a bright new world. This picture (of LEP) is what is projected by its protagonists (sic. Government of India) and what is visible to casual observers.

Indeed LEP holds a lot of promises for India taken as a whole.

It was conceptualised in the early 1990’s when the Indian economy, then in serious crisis of debt, was forced to open to foreign capital and investment particularly to the thriving economies of South East Asia.

This strategic move successfully vouched the ailing Indian economy.

But a critical study of the policy with special focus on the region in general and Manipur in particular reveals myriad implications and ramifications.

Apart from its stated objectives of coupling the Indian economy with the thriving economies of South East Asia, LEP has been transformed as an effective instrument for engaging Myanmar, perhaps the most isolated country on earth till the last couple of years and thus, counter China’s growing influence in South East Asia.

LEP might have taken time to materialize but in terms of flow of global finance capital, the region is not new. Meghalaya’s episode with Lafarge for mining of coal and direct export to Bangladesh, capital from Asian Development Bank for the exploration of the Brahmaputra River Basin for oil and natural gas and for development of agriculture in the Northeast occurred simultaneously along with the opening up of India.

Today, Reliant Energy is investing in Manipur for the exploration and extraction of oil and petroleum from Manipur, and the World Bank is funding the development of Trans Asian Railways and Highways.

Currently, the Asian Development Bank is financing construction of Tupul-Bishnupur and Thoubal-Kasom Khullen Road.

The Northeast as an unexploited region is a hotspot for investment in minerals, hydro-power, oil and natural gas. As such, no investors would now shy away from investing in the region including Manipur.

Already, the NDA Government led by Narendra Modi is planning a Smart City at Haollenphai near the border town of Moreh.

In the meantime, the Government of India and its Myanmarese counterpart have been making hectic preparations for introduction of international bus service between Imphal and Mandalay.

Given all these developments, one can safely conclude that a sweeping change is on the card. One pertinent question that arises at this point is, how well prepared are the State Government and the people of Manipur to face the all pervasive changes and the challenges they posed.

Unfortunately, most of the dealings made with foreign investors and MNCs are done by the Government of India, often reducing the role of the State Government to mere spectator or facilitator.

More often than not, the Central Government clinches the deals without even letting the State Governments know (about the deals) at all.

As such, the issue of profit sharing has been cancelled right from the beginning whereas the indigenous people and their land and resources are left at the mercy of insatiable foreign investors and MNCs.

The real issue, therefore, is not absence of investors or investment. The real issue in the coming years would be how to regulate and monitor exploitation by MNCs, ensuring resource sustainability, and profit sharing with the people of Manipur.