Abstract
The present article tries to map the development scenario of Manipur in terms of its performance in economic growth, unemployment and human development. The findings show the growth of Manipur’s economy is very erratic compared to the all-India scenario. Also, regarding unemployment, the picture is not very impressive, and life expectancy and a decent standard of living are low compared to all-India. The above specific development scenario is explained in terms of four challenges the state is facing today: Inability to generate its own resources, incomplete development projects due to corruption, prevalence of customary laws and widening of hill-valley divide. This study, based on secondary data sources, aims to contribute to the ongoing debates on development in the state of Manipur.
Introduction
The Northeastern states of Manipur have two distinct landscapes, that is, the Imphal Valley region and the hills. Meitei 1 and Pangal 2 make up the valley’s population, whereas the Nagas 3 and Kuki 4 (scheduled tribes) mostly inhabited the hills. The state has often been in the news due to political violence, insurgency, ethnic conflict, the Armed Forces Special Power Act (AFSPA), and economic backwardness. The majority of the state populace depends on agriculture for a living, making it their economy’s mainstay. Manipur’s economy is marked by high unemployment and poverty, limited investment, deficient infrastructure, physical isolation and essentially no industrialisation (Sharma, 2016). Such a development scenario is often linked to insurgency, development disparity, unequal power relations between hills and valleys, and failed land reforms rather than market anomaly in the global capitalism structure (Bardhan, 2002; Bhatia, 2010; Kamei, 2018; Phanjoubam, 2010; Piang, 2014; Singh, 2007, 2011b; Ziipao, 2020). Nevertheless, the dominant narrative does not consider the possible effects of the trickle-down effect that deprivation, subjection and oppression could be contributing factors to building a new type of oppressive structure reproducing vulnerabilities of underdevelopment of the state. An alternative thesis that needs to delineate the occurring issue is on the potential nature of economic growth resulting from the role of collective action (Acemoglu et al., 2005). This raises a fundamental question, what could be the main causes of the state’s low level of development performance? Why did Manipur remain one of the most financially dependent states after more than four decades of statehood? Is the administration’s mismanagement of resources responsible or is turmoil in the area a symptom of underlying economic issues? Pertinent to this, the present study locates the economic performance of the state, resource mobilisation, performance of state administration, underpinning of customary law and economic growth rate, and hills–valley development disparity. The article’s argument is based on secondary sources extracted from the Manipur Economic Survey (various years), Finance Account and Annual Financial statement, National Accounts Statistics (NAS), and other published articles. An analysis of pertinent secondary literature is used to frame the debates in terms of analysis and place the secondary data acquired.
Economic Performance of the State
Gross state domestic product growth rate, as displayed in Figure 1, presents the annual growth rates of Manipur GSDP at constant price (2011–2012). For the past nine years, it appeared that the rate of growth has been fluctuating throughout the years as compared to all of India’s growth rates. Manipur’s growth rate shows an inconsistent movement noticeable by high magnitude throughout the series. Worse, Manipur’s per capita income stagnated during the 2011s. From 2011–2012 to 2017–2018, the per capita income of Manipur ranked below the Indian national average (see Table 1).
Per Capita Income (in ₹) at Constant Prices (2011–2012 = 100).
The growth rates were 0.61%, 4.01%, –2.61%, and 5.06% in 2012–2013, 2016–2017, 2018–2019 and 2019–2020, respectively. Following low growth rates in these years, the year observed an increase in annual growth rates to 8.64% (2013–2014), and 9.77% (2017–2018) Except for a significant dip in 2020–2021 owing to the Covid epidemic, India’s GDP growth rate has been constant during the time under review, unlike the inconsistent pattern of Manipur’s GDSP growth rate (Figure 1). A similar erratic movement of GSDP growth rate has been observed while taking into account prior data, that is, before 2011–2012. Notwithstanding, to justify the erratic growth rate of Manipur GDSP, the current data is sufficient.
To understand the erratic growth rate of Manipur, it is worth noting to look at the sectoral share to the gross value added. A glance at the primary sectoral percentage contribution to gross value added (see Table 2), the steady drop in GSDP after 2014–2015 (see Figure 1) is particularly because of the decrease in the primary sector (see Figure 2).
Sectoral Percentage Contribution by the Primary Sectors to GSVA at Basic Prices at Constant Prices (2011–2012) in Percentage.
Indeed, given the significance of agriculture as a share of the primary sector and contributing more than 60% to the primary sector (see Table 2). One would, therefore, expect agriculture to be more consistent in sharing with the primary sector than another sectoral share. However, it turned out to be an erratic trend (see Table 2). As a matter of fact, there are compelling arguments that suggest for improving the agriculture productivity and output. It is also clear that the uneven and unpredictable action of monsoon (see Table 3) backed by insufficient irrigation facilities (see Table 4) has resulted in acute fluctuations in agricultural production. Lack of contemporary institutions, continued use of archaic farming practices including slash-and-burn, shifting and swiddening, pressure from an expanding human population on the land, and shortened jhum cycles all contributed to a decline in agricultural output (Thuanliang, 1997).
Rainfall Recorded in 2012–2020.
Estimates of Irrigated Area and Not Irrigated Areas Under Cereal Crops During the Agricultural Year in Manipur (Area in ’000 hect.).
However, without major investment and concerned government intervention, agriculture will continue to grow slowly, which would have a negative impact on the primary economy.
The secondary sector’s contribution to Gross State Value Added. Table 5 presents the share of the manufacturing sector which has had a high degree of fluctuation over the last nine years. As a result, the share of the secondary sector declined from 15.39% in 2012–2013 to 12.26% in 2020–2021 (see Table 5) and the annual growth rate has been in an erratic trend (see Figure 2). Despite having abundant mineral and forest resources, Manipur’s industrialisation has been excruciatingly slow. As a matter of fact, different regulations and programs that provided rewards and concessions packages were not very helpful. Thus, the government has therefore chosen to shut down a few of its losing PSUs industries owing to monetary constraints, and not enough funds for maintenance.
Manipur Cycle Corporation Ltd. (MCCL), Manipur Cement Ltd. (MCL), Manipur Drugs and Pharmaceutical Ltd., Manipur Spinning Mills Corporation Ltd. (MSMCL), Manipur Pulp and Allied Products Ltd. (MPAPL) and (Govt. Sector) are the public undertaking industries to dissolve (Economic Survey 2020–2021). All these failures have resulted in a low share of manufacturing in the secondary sector contributing around 15%–16% (see Table 5). Another important observation from Table 5 is that construction has the largest share in the secondary sector contributing 58%–60% over the study period. Table 5 makes this obvious by displaying the contribution of construction activities to the secondary sector component of the GSVA. The share of construction percentage increased significantly from 7.91% in 2011–2012 to 8.65% in 2020–2021 (see Table 5).
Sectoral Contribution by Secondary Sectors to GSVA at Basic Prices at Constant Prices (2011–2012) in Percent.
Finally, let’s take a glance at the service sector in Table 6, which shows that the services have shown a more consistent higher annual rate than the manufacturing and therefore the agricultural sectors of the economy. Given the predominance of the services within the Manipur economy contributing quite 60% to state GSVA, but major contribution came from public administration, with other services and trade, hotels and restaurants and other sectors like transport and communication and banking and insurance having an awfully small share (see Table 6).
Sectoral Contribution by Tertiary Sectors to GSVA at Basic Prices at Constant Prices (2011–2021) in Percent.
The pre-liberalisation economy saw a shrinking manufacturing sector and a growing tertiary sector. In the post-liberalisation phase, neither agriculture nor manufacturing has become an accelerator of the economy, while the rapid growth of the tertiary sector is the order of the day (Sharma, 2012). However, one must remember that Manipur’s economy is still based on agriculture. That the state is falling extremely behind in the manufacturing sector and agriculture production is obvious from the movement of sectoral growth share. The state also experienced an increase in its GSDP in 2017–2018, which was perhaps due to its high level of growth in the primary sector. The growth experience of the state reveals that the growth of the tertiary sector is a driving force.
Unemployment
Manipur’s problem, however, is not simply economic growth performance but the creation of employment. Job creation is a significant part of any development policy in emerging countries (Papola & Sahu, 2012; Sharma, 2012). The key challenge for policymakers has been increasing the number of employment opportunities in the state. This is a contentious topic in both political and intellectual debates. According to the 2011 Census, the maximum number of people are working as cultivators and agricultural labourers (see Table 7). Around 1,52,726 people work for the government in total in the state (Laithangbam, 2014). Therefore, in 2011, the percentage of government employees in the labour force was approximately 11.71%. Realising the need to create more employment opportunities in the state, the Government of Manipur has started a flagship program known as ‘Start-up Manipur’ in 2017–2018. This program aims to catalyse start-up culture, build a strong and inclusive ecosystem for innovation and entrepreneurship in Manipur, and generate large-scale employment opportunities (Planning Department, GoM, 2018). Under this flagship program, the expert panel will select the startup based on their business plan, feasibility, scalability and budgets. This is a welcome initiative. However, nothing much happened in employment opportunities. This can be quickly assessed by noting that in Manipur, the unemployment rate for people between the ages of 15 and 24 is approximately 44.4% (Economic Survey of Manipur 2020–2021). This keeps pressure on public employment as employment opportunities are not growing due to a lack of industrial foundation, in the private sector. The result is a disproportionate rise in public employment, which is accompanied by resentment on the part of those who are unable to secure such work. Due to such a situation, numerous young people from Manipur have been leaving the state in search of employment elsewhere, leading to an increasing brain drain in the state. Numerous academics and intellectuals suggest that a lack of political will, a lack of work culture, and a lack of support for skills development are the reasons for stifling development and the State’s high unemployment rate. Sharma (2016) writes,
Lack of incentives for private enterprise participation … poor trade opportunities with Myanmar … are the reasons why educated youth seek financial security by joining the insurgent groups … militancy is fast emerging as an alternate and a lucrative, means of employment … these militant groups have established a parallel government and parallel economy, and if they are allowed to do so the conflict in Manipur will remain. (Line 40–46)
Number of Workers and Non-workers in Manipur 2011 Census.
This narration is not an exception but represents the situation of the majority joining insurgent groups in the state. It is a well-documented fact that in Manipur, the conventional wisdom is that government jobs are the ‘Only Jobs’ that gain greater importance. Traditionally holds that a government job is ‘not demanding’ and ‘provides a lot of benefits and comes with job security’ (Muralidharan, 2015). In addition, social norms and parental pressure on younger people have contributed to the appeal for government employment. Moreover, a craving for government jobs rather than ‘dignity of labor’ also contributes to the increasing number of educated unemployed. According to Singh (2011a), the state government has been recruiting state security personnel regularly—which Sharma (2012) has termed as ‘Militarisation of employment’—while other recruitments are irregular and uncertain. The rush for government employment has had the unintended consequence of fostering bribes for recruitment. Generally, it is discussed in private conversation about the rate for government jobs in Manipur ranging between five hundred thousand to six hundred thousand for a primary teacher, 1.5 million to 2 million for a Post Graduate Teacher, or even higher for a state civil services post. This predicament is worse than high inflation or any other catastrophe since prices are constantly rising.
Hesalth and Education
Seen in the above perspective about the erratic growth rate of the Manipur economy. One, would, therefore, expect the state to be not much better on human development as well. It is, however, essential to avoid the naïve opinion that argues growth translates into the improvement of human well-being. In answering these views, a glance at Table 9 gives a rosy picture, where, interestingly, Manipur’s life expectancy rose from 63.9 years in 2011–2012 to 66.2 years in 2017–2018. A similar pattern was observed in infant mortality rates: 14 per 1,000 live births in Manipur compared with 47 per 1,000 all India in 2010. It is also worth noting that infant mortality rates reduced from 14 to 6 in 2020 and were estimated at six per live births in Manipur, and 20 per thousand in all India. This reflects that infant mortality was much lower in Manipur. This could all be related to the fact that an increase in the number of trained doctors and nurses (see Table 8) and education (see Table 9) are the key reasons behind improving infant mortality and life expectancy. However, nothing much to take pride in, and one should bear in mind the state lagging in life expectancy at birth and decent standard of living as compared to all-India (see Table 9). One possible reason is neglect of the state government on social infrastructure predominantly occupied by tribal communities. As Ziipao (2020) pointed out:
Even basic needs, such as all-weather roads connecting all villages, minimum elec-tricity supply, health-care centres, primary schools and potable water, remain inaccessible for most tribal communities in the State of Manipur. (p. 27)
Number of Doctors and Nurses Employed in Manipur.
Selected Development Indicator of Manipur.
This has had bearing on remote tribal villagers carrying pregnant women, sick people in bamboo stretchers to the nearest primary health centre, leading to death in some cases. Furthermore, due to lack of road access, finished goods such as fruits and vegetables are unable to transport them to the market, causing them to rot, and this has impacted their income. All these add up to the indelible bearing on life expectancy and decent standard of living in the state as a whole.
Major Challenges
There are numerous reasons behind Manipur’s disappointing development record, and no article, much less a small portion of one, can adequately address them. Internal conflicts have played a role. One of these is the rise of multiple insurgency groups. Others, such as ethnic conflicts and the lack of investment in the Manipur economy deserve mention. But the burden for Manipur’s development rests on Manipur itself. The external factor can increase or decrease the growth potential, but it always leaves the state with a lot of discretion on how well they execute, in Manipur as elsewhere. Among the many domestic factors that contribute to the state’s poor development 5 performance, four seem to be the most important and relevant to this study, which has been examined one by one below.
State Not Able to Generate Own Resources
On 21 January 1972, Manipur formally joined the Indian Union as a state, with an appointment of the Governor as the state’s head of government (Economic Survey 2020–2021). However, after more than four decades of statehood, the state has failed to generate its revenue meeting the obligatory non-developmental and developmental expenditure. Manipur’s misfortune is its over-reliance on the federal government. Not only this, the people of Manipur are also increasingly becoming reliant on a grant-in-aid subservient economy.
The state’s performance in the mobilisation of resources has a scanty share of State Own Tax and Non-tax sources (see Table 10). The state of Manipur’s share of Union taxes and grants in aid from the central government contributed within the range of 90% and 92% to the state revenue receipts and remained the main contributor to state revenue receipts (see Table 10).
However, it must be acknowledged that committed expenses, namely on Salaries and Wages, Interest payments and Pensions, accounted for more than 60% of the total revenue spending (see Table 11). In that sense, the government of Manipur has been investing more time in maintaining itself than in developing the resources needed to improve the economic performance of the state. These are the outcomes of the government’s tendency to hire more staff than the revenue generated by the state, which is still largely dependent on central funding. In this case, the pressure for the government is effectively to reduce expenditure on ‘Nonproductive’ purposes.
However, it would not be astonishing, indeed, that capital spending is required if the state economy is to move ahead. What is recorded in the data appears that capital expenditure has fluctuated throughout the year (see Table 12) and public debt has rapidly increased over the years (see Table 12). Of course, it has been said often that it is essential to use public debt productively as it must be repaid along with interest. In the case of Manipur, the increase in public debt (see Table 12) has been perhaps the most striking feature of the state economy due to political and other reasons. A basic question arises—Why do they go beyond their mean for political reasons and other factors? The answer to the question is in fact, the government is primarily responsible for financing the creation of jobs through the establishment of state enterprises. The emphasis placed on development means specific physical transformation of infrastructure such as public transportation, water supplies, schools and health care facilities. This situation, essentially amounts to a call for increased government borrowing, since the state could not generate enough sources of income, to the extent that the state’s public debt surges up (see Table 12). This provides clues about what has been happening over the years in Manipur and is a direct reflection of the financial activities that went into its budgets on the income and expenditure sides. In part, borrowing offers an option to bridge the gap between rising revenue and expenditure, which is of a temporary nature. However, if the mismatch continues for a long period of time, the rise in tax revenue eventually is insufficient to pay the interest required to reduce the debt, leading to rising revenue and fiscal deficits, to the extent unsustainable debt follows from this. The outcome of this is evident in the year 2019 as the RBI stops honouring Manipur government bills, and cheques for overdrafts of over ₹300 crores (The Hindu, 13 June 2019).
Revenue Receipts of Manipur from 2011–2012 to 2020–2021 (in ₹ Million).
Revenue Expenditure 2011–2012 to 2020–2021 (in ₹ Million).
Capital Expenditure and Public Debts of Manipur from 2011–2012 to 2020–2021 (in ₹ Million).
The foregoing discussion gave an account of Manipur being a dependent state that mainly relies on central funding. Its economy is a salaried economy, with a state government generating 8%–15% of its revenue that has ensured the continued dependency on the central. The state government spends more than 60% on revenue expenditure leaving little for development projects. The government’s fundamental duty is to ensure the well-being of people who live within the state and to enhance their quality of life through programs and resources for development. Incomplete projects in the state, such as roads, electricity, Government schools, clinics and communication, are frequently acknowledged by the state administration in its reports, along with how this has affected the state’s speed of development and weakened the state’s enormous development potential. The next section examines some of these issues.
Project Incompletion and Ineffective Management in Manipur
How successfully projects are executed can provide insight into a nation’s progress (Hanachor, 2012). In a developing state like Manipur, where basic facilities like clinics, schools and electricity are difficult to access, catering to community facilities is a pivotal administration responsibility. To boost the economy, the Government of Manipur over the years spent funds on different projects. However, many projects were hardly ever finished within the planned time (see Table 13), leading to loss of revenue due to cost upsurge and schedule delays.
Incomplete Projects of Manipur Government (in ₹ Million).
This raises some pertinent questions: Why would the same government complete the project later? There are perhaps sufficient reasons for the time that is generally taken. And the consensus of people is that corruption must be its primary motivator if a development project fails. Project incompletion need not result from project delivery corruption (Williams, 2017). In fact, when corruption reveals itself most habitually in the form of inflated contract values or poor quality (Olken, 2007), to fully recover their surplus rents, contractors may have increased incentives to complete projects (Williams, 2017). And, unless projects, especially the major and medium ones, are finished quickly and on schedule, there will not be any help for the economy as a whole (Pant, 1982). Examining the different causes of the unfortunate situation that has resulted in the completion of these projects being delayed would be appropriate. Numerous departmental reports have addressed this issue, therefore let’s examine these reports.
The Report of the CAG of India (Report no. 2 of 2021; GoM, 2021a), stated that only 49 out of 55 district courts were completed in nine districts. Due to the delay in releasing funds, the construction of the courthouse in the Tamenglong district as well as the courthouse annex buildings in the Thoubal and Bishnupur districts remained unfinished, showing that the money that had been approved had not been given the highest priority. The Department also failed to offer encroachment-free land for the construction of quarters in the Tamenglong district in addition to the incomplete works. These delays impacted the timely completion of the projects and the intended benefit from the projects. It was further found that the regular system of monitoring the progress of infrastructure work has not been monitored properly.
Most projects, however, are being executed either by the Public Works Department or by the Water Resources Department, and the Minor Irrigation Department. Regarding the awarding contracts for the projects, the CAG report uncovered anomalies in 39 Public Works Department divisions, the Water Resources Department and the Minor Irrigation Department, which used an irregular and opaque bidding process to award 895 contracts for works worth a combined ₹7,508 million. Ziipao (2021) highlights the politicisation of road construction in Manipur, where the contractors, irrespective of their credibility, would take the contract work if they were in touch with ministers and insurgent groups, and the local elites act as gatekeepers for contractors to get access to ministers and insurgent groups. Similarly, in many cases, difficulties are experienced in the execution of developmental projects due to problems created by the various groups in Manipur. This is perhaps most clearly illustrated in the work of Ziipao (2018):
The projects that involve the development of physical infrastructure continue to be a source of contestation and conflict in varied forms: state vs. ethnic civil society, state vs. non-state actors, and among different ethnic communities. (p. 12)
The results are reflected in the form of abandoned work or construction work that was put on hold. These elements had a negative influence on the spending’s quality and delayed the State’s receipt of the anticipated benefits. As Williams (2017) demonstrated in Ghana, rather than corruption or clientelism, collective choice failures drive project non-completion. The inconsistent and unexpected nature of local political agreements causes projects to be abandoned mid-construction. Additionally, local officials cannot agree on how to allocate a small number of projects across numerous ethnic communities. Williams further elaborates:
The intertemporal bargains … vote for my project this year, and I will vote for your project next year … are difficult to maintain, since individual members … have an incentive to renege ex-post on their promises to support projects in other members … and sacrifice their own immediate self-interest to sustain a coalition … these commitment failures make coalitions inherently unstable … which stops progress on the project. (pp. 11–13)
This narrative points to the necessity of collective choice and a deep nexus between various legislators in the assembly. It is a well-kept secret how projects in Manipur are never finished, and this practice is like Ghana’s project non-completion problem owing to collective choice failure. The absence of thorough construction planning at the project’s outset and the delay in the acquisition of construction materials have also contributed to the failure of many projects to meet their physical goals. As a result of this failure, the government will suffer a significant financial loss. These elements that cause project failure also cause stagnation in national development (Nweze, 2016) and further block the anticipated benefits to the residents and citizens of the state.
In the foregoing section, we have discussed the incomplete development projects. It would be in the fitness of things to examine the most important indicator of the health of the economy—investment—by the government of Manipur. The state government over the years has invested in companies, corporations and cooperative societies ranging from ₹1,758.3 million to 2,141 million. Against this, the State Government could earn only ₹59,000 from 2008 to 2020 (see Table 14).
Return on Investment from Government Companies/Corporations/Co-operative Bank, etc.
Return on investment has not been growing at the rate required for the trend rate of increase in investment witnessed from 2008 to 2020. As of 2020, the State Government had invested in statutory corporations, Government companies, and a number of various types of cooperative banks and institutions with a combined worth of ₹2,141 million. However, the rate of return from the investment was insignificant. Most of the companies incurred substantial losses.
Table 14 presents the years-wise data regarding the amount of investment made by the state government during the last 13 years. It is fascinating to note some of the significant tendencies that the table reveals. The Manipur government spent 1,762.5 million in 2009–2010. In contrast, the state government could only generate ₹28,000, which is the highest rate of return across the study periods. The years 2010–2011, 2012–2013, 2016–2017, 2017–2018 and 2018–2019 followed with ₹4,000 each. With ₹3,000 each, the years 2011–2012, 2013–2014 and 2015–2016 held the third position. The state government could only make ₹2,000 in 2014–2015, compared to nothing in 2008–2009. In terms of investment escalation during the past 13 years, Manipur experienced an average increase of 17.88%. The state government experienced the biggest investment increase in the year 2019–2020, totalling 2,141 million with a zero percent return. This means there are deficiencies in financial management, planning inefficient running and a lack of proper monitoring. Rent-seeking, nepotism and favouritism are nothing new in Manipur (Ziipao, 2021), where meritocracy is given a backseat. The outcome of this is reflected in the form of zero percent return (see Table 12).
Customary Law and Economic Growth
It is generally believed that the rule of law is necessary for economic growth. However, the concept of the rule of law is undoubtedly multifaceted, comprising a range of distinct elements, from the protection of individual rights and property to checks on the executive branch and corruption prevention (Haggard & Tiede, 2011). The hill peoples of Manipur follow the customary law and regard it as being as old as the people themselves (Panmei, 2010). The community’s desire and the general public’s acceptance and support of them ensured the continuation of customary law.
Table 15 raises a natural question: What caused the higher growth rate of NSDP in valley areas as compared to hills? This question has not received sufficient attention. However, it has something to do with customary law which is crafted with scant regard to the market response. Since an economic policy must first receive societal approval in order to be more successful (Kafka et al., 2020; Petrakis & Kostis, 2013). Customary laws effectively protect their lands from being encroached on and taken away by non-tribal groups, including industrial houses (Zimik, 2021). These are good signs emerging that the tribal people are protecting their lands. However, in the case of Manipur, customary law privileging the hills did not allow the valley to engage and own property in the hills. For example, hills in Manipur usually do not agree to lease land or an irrigation facility for economic activity to take place whenever modern-based markets try to penetrate since land is the primary means of production (Singh, 2007). Additionally, investing in hills is not wise due to the low population density and swidden farming practices there (Arora & Ziipao, 2020). Hence, customary law which protects the tribal land in the hills has barriers to attracting investors. Failure to enhance the ease of doing business has an adverse effect on the hills of Manipur. The growth scenario is like the pre-economic reform in India, where the country’s economy is not integrated with the world—no capital flow, no trade, creating new opportunities for exporters, and entrepreneurs nationwide. In the hills of Manipur, it is being pushed by the customary law to continue protecting land and resources without engaging deeper issues on the reason of low level of agriculture production, and lack of industrialisation and employment. All these elements play a role in the economic backwardness of the hills of Manipur, which is reflected in the form of low contributions in NSDP (see Table 13).
Contribution of Hills and Valleys to the State NSDP.
Hills–Valley Divide: A Contemporary Development Debate
The approach to development in Manipur has been widely contested between hills and valleys owing to variations in development. The composite score of development (Table 16) reveals the huge disparity between hills and valleys. This naturally raises the question of what contributes to the valley sub-division’s greater development scores than the hills sub-division.
Development Scores, Manipur-2011.
According to some schools of thought, structural domination by the valley continues to be a hurdle for development in hill districts (Kamei, 2018; Piang, 2014; Ziipao, 2020). This can be easily gauged by taking into account the number of representations from valleys in political, social and employment and major economic activities taking place in the valley. However, the critique of the above school of thought argues that rather than structural domination by valleys, the failure of land reform deepens an uneven economic performance in the hills (Phanjoubam, 2010; Singh, 2007, 2010). According to them, the valley has a liberalised land-owning system, the hills stick to the customary. The valley has a diversified population and one of the largest population densities without any restrictions on the movement of people, products and innovative ideas, as people from the hills move there, buy land and establish themselves. All have contributed to the progress and growth of the valley. The tribals-dominated hill areas continued to govern the land according to their own customary law (Kamei, 2018). Interference to their land is therefore opposed tooth and nail (Panmei, 2010) which leads entrepreneurs and government to respond strategically, often in complicated ways. As Singh (2009, p. 68) pointed out ‘Manipur’s tribal or hill areas, prolonged poverty is a result of a variety of causes, including a hazy system of tribal land ownership and low agricultural productivity … closely linked with the issue of land ownership related incentive systems’. This narration also finds the same expression in the words of former Deputy Commissioner of Tamenglong district Mr Pame (2019) writing on his personal Facebook page
The sanctioned amount of ₹ 13,300 million for Tml-Peren road just halted. The amount of ₹21,000 million for the Tml-Tousem-Haflong road halted. All these are not progressing because we want both ‘roads and compensation’. Now is the time to decide what is good for our people in the larger interest.
Mr Pame’s comments echo the ‘new Manipur’, where the lack of basic facilities, low level of economic development, and infrastructure deficit in the hills can be overcome by changing traditional institutions that have been strongly resistant to change in Manipur, especially in the hills.
The presence of traditional elements plays a part in Hills’ inability to experience a rapid economic transition and limiting to gain as much as possible from the increasingly invisible hand, the political system, trade and globalisation as Sen (1999, p. 7) noted that ‘denial of access to product markets is often among the deprivations … which many small cultivators and struggling producers suffer under traditional arrangements and restrictions’.
Indeed, the hills in Manipur have consistently received attention on land ownership, relative incentives and coverage for its economic embargo and ban on construction-related activity. It is a tactic used by protesters to pressure the government to voice their demands and bring the state’s focus to a variety of concerns that affect them. For instance, the villagers of Marangching in Tamenglong district blocked any railway line development in the year 2016 on the grounds that they had not received fair compensation for the lands used for the Jiribam–Tupul–Imphal railway project (
The Sangai Express, 2016
). When this development-related work is banned for whatever reason. Ultimately, it is the larger public in the hills that suffers in the forms of incomplete roads, non-motorable during the monsoon in the hills of Manipur, which Singh (2007, p. 253) comments that ‘the transport bottleneck in the hills has made the hill economy costlier than the valley … and real wages are quite low in the hill economy … prices are very high as transportation costs are very high’. It is in this sense that hills in Manipur are deprived of material development and access to modern facilities. It is a constant burden on the economy, causes supply chains to break down, and influences governance and entrepreneurs. Sachs (2005) did put the issues with admirable clarity in the passage on this subject:
Even when governments are trying to advance their countries, the cultural environment may be an obstacle to development. Cultural or religious norms may block the role of women, for example, leaving half the population without economic or political rights. (p. 60)
Total assimilation of valleys and hills into Manipur, it can be argued, has never convincingly been achieved despite their long residence in the state. This is in part due to the special and highly complex nature of Manipur society. It would be instructive to quote directly at this point; from Arora (2013, cited in Arora & Ziipao, 2020, p. 38) ‘The elite’s desire to control development resources … has directly contributed to infrastructure deficit and its frequent destruction, and furthered a security perspective’. At the fundamental level, the issue is: How does the valley perception toward the hill communities and vice-versa?
The relationship between valley and hills was conditioned by the trust deficit and the assumption that each community or tribe itself was the victim while other communities as foes, exploiters, intruders or seeming suspicion (Singh, 2011b). In this context, Datta (2001, p. 84) argues that ‘the suspicion of outsiders has inhibited economic activities that would otherwise contribute to the economy in the region’. Trust takes time to establish, unlike other public goods, it increases with continued use (Gambetta, 1988). Note that Gambetta assumes ‘lack of trust’ indicates an externality where some of a decision’s repercussions are not within the decision maker’s control. It is worthwhile to mention several studies that suggest peaceful coexistence is possible only if rights are fulfilled and historical injustices are corrected (Bardhan, 2002; Bhatia, 2010). In this context, giving autonomy and legitimate demand for hills would strengthen territorial integrity and enhance prosperity. The articulation of this view is evident in the form of the demanding ADC Bill, 2021 by The Hill Area Committee (HAC). This bill aims to empower the hills’ autonomy in legislation, finance and administrative division and ensure development is at par with the valley. This is a welcome initiative. However, the question is, in case this ADC Bill, 2021 becomes necessary, what would be the criterion that defines notions such as ‘autonomy’? Would it mean only the major tribes enjoy maximum power and deny the basic rights to minor tribes? Each group has a dominant worldview over minority groups, which complicates the mechanics of articulation between the valley and the hills. This is evident in the observation of Haokip (2022, p. 27) once a major tribe fought for some form of autonomy, but was now unwilling to grant even a little power for self-governance to smaller tribes. This implies that the concerns and opinions of the most impoverished STs are not always represented by the middle-class, affluent English-speaking STs (Shah, 2010).
Manipur’s diverse population is no stranger to conflictual manoeuvres rather than peaceful negotiations. The outcome of these conflicts is reflected in the form of fighting for their self-determination, which led to the formation of multiple insurgency groups. What is taking place is a ‘trickle-down effect’. The argument in favour is that they are safeguarding their territory and asking for their rights. However, the formation of multiple insurgency groups has certain other implications—violence, illegal taxation, extortion and adverse effects on development activities. This parochial mentality is something that each community consistently reaffirms, supports and stamps on the public’s social awareness. As Palkar (2015, p. 44) writes ‘This creates the characteristic of class divide, where those in privilege seek to expand it and those that have little struggle … and this class formation creates animosity towards the wealthy … with a mix of ideology easily turns into the brew of militancy’. A state-prepared policy document recognised the importance and immediate necessity of inclusive development and inclusive participation in decision-making (Manipur Vision Document 2030), and the imperative of the need for peace, justice and strong institutions for achieving the SDGs in the state. The Manipur Vision 2030 (Planning Department, GoM, 2019) also pointed out the fact that achieving progress, maintaining peace and accelerating the rate of development depends on eliminating inequality and contends that stability in economic development fosters state unity, which in turn fosters development. Additionally, the document envisions the state catching up to the rest of the nation in terms of per capita income. If everything goes as planned, India’s per capita income should reach ₹193,961 by 2030. The Manipur GSDP will need to grow at a rate of ₹717,660 million if the population is 3.7 million, and at a rate of ₹756,450 million if the population is 3.9 million to reach the national real per capita target of ₹193,961 in 2030. A closer examination is necessary to determine whether the region can expand its GSDP by ₹717,660 million to catch up to the rest of the country. With the release of a document, the state government has undeniably taken a step that each community has a place in society. The valley-hills conflict, however, creates room for different groups to form their own objectives, which severely affects the state development activities.
This gives the idea that economic institutions should be seen as a network of connected steps done to enhance a society’s functioning. This view is developed by Acemoglu et al., who argue that ‘Society will able to prosper provided society that is willing to organise itself … through encouraging people to innovate, to take risks, to save for the future … solve the problem of collective action and provide public goods’ (2005, p. 12).
Discussion and Conclusion
The aforementioned demonstrated that the state’s economy is in trouble. Little effort is placed into resource mobilisation and the state government mainly relies on the central government for financial support. The state government’s development strategy and program are out of touch with the necessities and desires of the people. If Manipur wants to sustain and rise, the state must comprehend its plurality and institutional norms. Putnam et al. (1993) explain the differing patterns of regional growth in Italy and credit the northern region’s superior performance to properties of ‘social capital’ such as trust, conventions and networks that can improve the efficiency of society by promoting ‘collective actions’ (pp. 177–180). A major contribution to the state NSDP comes from valley areas instead of hills areas despite covering 90% of the geographical areas (see Table 7). Hence changing existing social, economic, political and institutional structures favourably is necessary for the hill’s economy. However, any modification must be of a kind that Polanyi posits ‘reciprocity and redistribution’ (as cited in Machado, 2011). In adjustment of existing law, the free-riding problem must not occur between the two parties. Hume for instance posits: ‘Every man ought to be supposed a knave, and to have no other end, in all his actions, then private interest’ (cited in Farrant & Paganelli, 2005). Hence, applying the modern state institution norms and market forces forcefully to the hill areas will only result in obstructionism and alienation of the tribal people. As in a plural society, it is improper for society to operate in one manner. However, one should not be entirely selfish nor too generous; otherwise, it wrecks society through fierce rivalry. It is ideal to maintain a balance. Each community has its own view of what a balanced society is. Any effort to engineer policy changes, such as those made by neo-liberalisation, is ineffective since they simply ignore policy changes—Privatisation happens, but the people winning the contracts are the brothers of the ministers, for example, or the state says it implements a policy but they just carry on as normal! What is required for the state where the plurality of voices needs to be considered in the execution of development activities? Without such a structure, society will fail that have ‘extractive economic institutions’, supported by ‘extractive political institutions’ that hamper and even obstruct economic growth (see Acemoglu & Robinson, 2012, p. 95).
Footnotes
Declaration of Conflicting Interests
The authors declared no potential conflicts of interest with respect to the research, authorship and/or publication of this article.
Funding
The authors received no financial support for the research, authorship and/or publication of this article.