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Assam is one state among seven sisters in Northeastern India 🇮🇳 with an economy based on agriculture. Assam’s biggest contribution to the world is Assam Tea, and it plays a vital role.
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While most of the states in India are gradually moving away from their conventional agricultural based economy towards a secondary or service-oriented economy, Assam is still laboriously reliant on the agricultural sector. Compared to most other states in India, it is considered as less flourish state which depicts a dingy picture of the economic condition of Assam.
Assam produces both food and cash crops. Although rice is staple crop of Assam its productivity over the years has not increased while the other crops have seen a slight rise in both yield and land acreage. Tea is the principal cash crop is Assam and well known globally for its idiosyncratic palate. However, the exploitation of both precious land and workforce by the tea venture, most of which are foreign owned or belong to Indian conglomerates is well documented.
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The economy of Assam is contingent on the primary sector or agriculture, but it faces many difficulties for the upliftment of the economy. Continuing to rely on seasonal monsoon water for cultivation is another attribute for farming in Assam. V.K.R.V Rao, an eminent economist, says, “Agricultural development problems and economic development issues are the two sides of the same coin, both go hand in hand. Prominence should be given to agriculture for economic development. There are many reasons for the primitiveness of farming, like natural calamities, capital deficiency, marketing problem, R&D, land reforms, information gap, out dated thinking, prejudiced cultural values, etc. However, there are problems like lack of entrepreneur and managerial talent, poor economic infrastructure, government bureaucracy and political unrest. These discourage investors so the state should step in to fill the gap which is left unfulfilled by the private sector.”
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The tea industry in Assam is about 172 years old. It occupies a prominent place and plays an instrumental part in the national economy. Assam contributes 15.6% of world’s tea production & 55% of India’s tea output. But over the years, there have been many challenges faced by Assam’s tea industry. The biggest problem is the high cost of production and low price realisation. Tea is a major foreign revenue earner for India and has an equally significant role in Assam’s economy. However, things are not as bright as it seems to be. The Assam tea industry is gradually sinking due to various problems being faced by it.