This paper analyzes the sectoral composition of the Net State Domestic Product (NSDP) of the Northeastern (NE) states of India for the period 1980-1996. It is revealed that there has been a growing trend of ‘tertiarization’ of the structures of production. The emergence of the service sector in a big way draws the attention to examine further the possibility of its ‘catalytic’ role in the economic development of the region. For this purpose, the structure of the service sector and changes within the sub-sectors of the service industries for the same period is further investigated. The recent development trends show that major contribution towards the growth of service industries is due to the increase in public administration expenditure. Although the service sectors like construction, trade, hotel and restaurants are developing in some of the NE states, other important service sectors like transport, storage, communication, banking and insurance are yet to develop to their full potential. This paper also discusses the issue related to the sustainable growth of the service sector, and thus, generate employment and income opportunities in the absence of significantly developed industrial sector. It is emphasized that, while in the short-run, growth of the service sector may provide the required impetus to generate additional employment and income opportunities, it is necessary that in the long-run, the simultaneous growth of agricultural, industrial and the service sector is desirable, in order to maximize the intersectoral linkage advantages. The inter-state comparative analysis suggests that the states adopting a more focused approach towards economic growth by implementing state level economic reforms policies forge ahead in future to provide better employment and income-generating opportunities, and thus, improve the standard of living of their people. For balanced and sustainable economic development, NE States have to adopt and implement a more focused growth oriented policy measure.
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Volume (Year): III (2006) Issue (Month): 4 (November) Pages: 60-69 Download reference. The following formats are available: HTML
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Handle: RePEc:icf:icfjie:v:04:y:2006:i:4:p:60-69
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