Expert Speak India Matters
Published on Aug 02, 2021
Despite the optimism, there also is a need of a certain level of realism and significant interventions at different levels.
Assam’s quest: En route to becoming one of the top five states in economic growth


The largest state in the Northeast with an area of 78,438 square kilometre and a sizeable population of 3.2 crores, Assam has been one of the states that has witnessed significant development over the past decade since it came out of the grapples of decades-long insurgency. The central government’s focus on the Northeast in the recent years has also helped Assam navigate through the local issues and carve out a path of inclusive growth for itself. The efforts of the stakeholders across political, bureaucratic, and social circles is also evident in the survey rank of Assam in the India Today State of the States survey, which ranks it as one of the top performers in the list of the most improved big states for three years in a row. However, despite significant improvement across various sectors, Assam still ranks 17th in terms of its contribution to the country’s Gross Domestic Product (GDP). Therefore, to change the status quo and put Assam on the list of top drivers of India’s growth, the incumbent government under the leadership of Chief Minister Himanta Biswa Sarma has envisioned to make the state amongst the top five best performing states in the country by 2026. The task, however difficult it may sound, might not be impossible given Sarma’s track record in revamping the education and health sector in the state during his tenure as a cabinet minister. But despite the optimism, there also is a need of a certain level of realism and significant interventions at different levels that need to be undertaken by the government on a mission mode to fast track economic and social development in the state.

Despite the optimism, there also is a need of a certain level of realism and significant interventions at different levels.

Focus areas and governmental interventions

“What gets measured gets done.” Regardless of specific focus areas, one of the most important aspects of ensuring the state is on the right track of development is to build a mechanism that enables capturing of real time data at the block level and creating a repository. This will empower the government to track and monitor the periodic development across various sectors and help them take up timely policy interventions wherever needed. Availability of quantitative parameters to assess development is one of the most effective ways to ensure the process of growth is on track.

Figure 1

Source: Author’s compilation from various NITI Aayog Reports and Ministry of Commerce and Industry website.

On specific parameters to ensure all-round development, one of the primary areas of focus could be the SDG (Sustainable Development Goals) index where the state ranks 24th in the recently published SDG report. The government, however, has been very proactive with regards to its dismal performance in the SDG index and has taken steps towards ensuring real-time data collection and carrying out all the required policy interventions through engaging with the Transformation and Development department, NITI officials, and various external agencies. Second, industrialisation and investments in the state of Assam has always remained slow due to various social and geographical challenges in the past. It ranks 20th in the Ease of Doing Business (EODB) parameter and has received a meagre US $11 million foreign direct investment (FDI) in the last financial year. Though the state has incorporated reforms suggested by the Department for Promotion of Industry and Internal Trade in the past, there needs to be more concrete steps taken in this regard. The state also fares poorly in the export competitiveness parameter and innovation. It ranks 21 and 29 respectively in each of the indices. Governmental interventions in the form of enabling single window clearance, simplifying the regulatory hurdles through segregating between compliances and procedural guidelines and limiting the number of required compliances, encouraging more patent filing across higher educational institutes to nurture a culture of innovation, amongst other measures could be a few steps in the right direction.

The state also fares poorly in the export competitiveness parameter and innovation.

The way forward

Figure 2

Average Growth Rate Assam Tamil Nadu Karnataka Maharashtra Uttar Pradesh Gujrat
2012-20 12.00% 11.71% 13.77% 10.87% 11.86% 13.61%
GDP (Lac Crore, 20-21) 3.5 19.43 16.65 28.18 17.05 16.39

Figure 3 

GDP per capita Assam Goa Sikkim Haryana Kerela Odisha
In INR (2019) 92533 476000 435000 260287 225484 111892

Source: Author’s compilation from MOSPI data.

In terms of the gross state domestic product (GSDP) and GSDP per capita figures (Figure 2 and Figure 3), the state still has significant ground to cover before it could make a place in the top five states. However, Assam as a state can start with working towards increasing its per capita GSDP and reaching levels comparable to states like Kerala and Odisha which have a similar population size. The state should also engage its SITA (State Innovation and Transformation Aayog) to actively participate in the process and come up with innovative solutions to complex problems that has been a hindrance to economic growth in the state.

Figure 4

Source: Author’s compilation from MOSPI data.

Assam primarily being an agrarian economy relies heavily on agriculture. The One District One Product (ODOP) programme of the Government of India could be a gamechanger for an economy like Assam. Uttar Pradesh has witnessed a significant 36 percent increase in exports due to significant push of the state government towards ODOP. The sectoral GVA as percent of GSDP and average growth rate (Figure 4) indicates that the construction, hospitality, and financial services sectors are one of the fastest growing sectors in the state, which would require specific focus from the government as these sectors could drive the state’s growth in the future. Given Assam’s performance in the recent times across a host of areas ranging from its handling of the COVID-19 pandemic to the way the government handled the micro-loan crisis, Assam could be one of the states to watch out for in the near future.

The views expressed above belong to the author(s). ORF research and analyses now available on Telegram! Click here to access our curated content — blogs, longforms and interviews.


Rouhin Deb

Rouhin Deb

Rouhin Deb was an Associate Fellow at ORF Kolkata. His research focuses on informal competition strategic choices and international businesses.

Read More +