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Economy of Meghalaya

Meghalaya is predominantly an agrarian economy. Agriculture and allied activities engage nearly two-thirds of the total workforce in Meghalaya. However, the contribution of this sector to the State's NSDP is only about one-third. Agriculture in the state is characterised by low productivity and unsustainable farm practices. Despite the large percentage of the population engaged in agriculture, the state imports food from other Indian states. Infrastructural constraints have also prevented the economy of the state from creating high-income jobs at a pace commensurate with that of the rest of India.

Meghalaya's gross state domestic product for 2012 was estimated at Rs.16,173 crore (US$2.3 billion) in current prices. As of 2012, according to the Reserve Bank of India, about 12% of total state population is below poverty line, with 12.5% of the rural Meghalaya population is below the poverty line; while in urban areas, 9.3% are below the poverty line.


Meghalaya is basically an agricultural state with about 80% of its population depending entirely on agriculture for their livelihood. Nearly 10% of the geographical area of Meghalaya is under cultivation. Agriculture in the state is characterised by limited use of modern techniques, low yields, and low productivity. As a result, despite the vast majority of the population being engaged in agriculture, the contribution of agricultural production to the state's GDP is low, and most of the population engaged in agriculture remain poor. A portion of the cultivated area is under the traditional shifting agriculture known locally as Jhum cultivation.

Meghalaya produced 230,000 tonnes of food grains in 2001. Rice is the dominant food grain crop accounting for over 80% of the food grain production in the state. Other important food grain crops are maize, wheat, and a few other cereals and pulses. Besides these, potato, ginger, turmeric, black pepper, areca nut, Bay leaf (Cinnamomum tamala), betel, short-staple cotton, jute, mesta, mustard and rapeseed etc. are some of the important cash crops. Besides the major food crops of rice and maize, the state is renowned for its horticultural crops like orange, lemon, pineapple, guava, litchi, banana, jack fruits and fruits such as plum, pear, and peach.

Grains and staples production covers about 60% of the land area dedicated to crops. With the introduction of different crops of high yielding varieties in the mid-1970s, a remarkable increase in food grain production has been made. A major breakthrough was achieved when high yielding varieties of paddy such as Masuri, Pankaj IR 8, RCPL and other improved varieties series – especially IR 36 which is suitable for Rabi season – allowing three crops to be grown every year. Another milestone was reached when Megha I and Megha II, which are cold tolerant rice varieties developed by the ICAR North East Region at Umroi near Shillong, was released in 1991–92 for the higher altitude regions where there was no high yielding rice varieties earlier. Today the state can claim that about 42% area under paddy has been covered with high yielding varieties with the average productivity of 2,300 kg/ha (2,100 lb/acre). As is the case with maize and wheat where the productivity have increased tremendously with the introduction of HYV from 534 kg/ha (476 lb/acre) during 1971–72 to 1,218 kg/ha (1,087 lb/acre) of maize and from 611 kg/ha (545 lb/acre) to 1,490 kg/ha (1,330 lb/acre) of wheat.

Oilseeds such as rapeseed, mustard, linseed, soybean, castor, and sesame are grown on nearly 100 km2 (39 sq mi). Rape and mustard are the most important oilseeds accounting for well over two-thirds of the oilseed production of nearly 6.5 thousand tonnes. Fiber crops such as cotton, jute, and mesta are among the only cash crops in Meghalaya, grown in Garo Hills. These have been losing popularity in recent years as indicated by their declining yield and area under cultivation.

Climatic conditions in Meghalaya permit a large variety of horticulture crops including fruits, vegetables, flowers, spices, mushrooms, and medicinal plants. These are considered to be higher value crops, but home food security concerns have prevented farmers at large from embracing them. The important fruits grown include citrus fruits, pineapples, papayas, and bananas. In addition to this, a large variety of vegetables are grown in the state, including cauliflower, cabbages, and radishes.

Areca nut plantations can be seen all over the state, especially around the road from Guwahati to Shillong. Other plantation crops like tea, coffee and cashews have been introduced lately and are becoming common. A large variety of spices, flowers, medicinal plants and mushrooms are grown in the state.


Meghalaya has a rich base of natural resources. These include minerals such as coal, limestone, sillimanite, Kaolin and granite among others. Meghalaya has a large forest cover, rich biodiversity, and numerous water bodies. The low level of industrialisation and the relatively poor infrastructure base acts as an impediment to the exploitation of these natural resources in the interest of the state's economy. In recent years two large cement manufacturing plants with production capacity more than 900 MTD have come up in Jaintia Hills district and several more are in pipeline to use the rich deposit of very high-quality limestone available in this district.

Electricity infrastructure

Meghalaya with its high mountains, deep gorges, and abundant rains has a large, unused hydroelectric potential. The assessed generation capacity exceeds 3000 MW. The current installed capacity in the state is 185 MW, but the state itself consumes 610 MW. In other words, it imports electricity. The economic growth of the state suggests rising demand for electricity. The state has the potential to export net hydroelectric-generated electricity and earn income for its internal development plans. The state also has large deposits of coal, thus being a candidate for thermal power plants.

Several projects are under works. The proposed Garo Hills thermal project at Nangalbibra is expected to generate an additional 751 MW of power. There is a proposal for setting up a 250 MW thermal power plant in West Khasi Hills. The State Government aims to increase its power generation output by about 2000-2500 MW, of which 700-980 MW will be thermal based while 1400-1520 MW will be hydroelectricity. The State Government has outlined a cost-shared public-private partnership model to accelerate private sector investments in its power sector. The generation transmission, transformation and distribution of electricity is entrusted to the Meghalaya Energy Corporation Limited which was constituted under the Electricity Supply Act, 1948. At present, there are five hydel power stations and one mini hydel including Umiam Hydel Project, Umtrew Hydel Project, Myntdu-Leshka-I Hydel Project, and the Sunapani Micro Hydel (SESU) Project.

For the 12th five-year plan of India, there is a proposal to set up more hydel power projects in the state: Kynshi (450 MW), Umngi −1 (54 MW), Umiam-Umtru -V (36 MW), Ganol (25 MW), Mawphu (120 MW), Nongkolait (120 MW), Nongnaw (50 MW), Rangmaw (65 MW), Umngot (260 MW), Umduna (57 MW), Myntdu-Leshka-II (60 MW), Selim (170 MW) and Mawblei (140 MW). Of these, Jaypee Group has committed itself to building the Kynshi and Umngot projects in Khasi hills.

Education infrastructure

Meghalaya had a literacy rate of 62.56 as per the 2001 census and is the 27th most literate state in India. This increased to 75.5 in 2011. As of 2006, the state had 5851 primary schools, 1759 middle schools, and 655 higher secondary schools respectively. In 2008, 518,000 students were enrolled in its primary schools, and 232,000 in upper primary schools. The state monitors its school for quality, access, infrastructure and teachers training.

Institution for higher studies like Indian Institute of Management, the University of Technology and Management (USTM) which is in Shillong is the first Indian university to introduce cloud computing engineering as a field of study, in collaboration with IBM and the University of Petroleum and Energy Studies. IIM Shillong is one of the top ranked management institutes in the country.

Health infrastructure

The state has 13 state government dispensaries, 22 community health centres, 93 primary health centres, 408 sub-centers. There were 378 doctors, 81 pharmacists, 337 staff nurses and 77 lab technicians as of 2012. A special program has been launched by the state government for the treatment of tuberculosis, leprosy, cancer and mental diseases. Though there has been a steady decline in the death rate, improvement in life expectancy and an increase in health infrastructure, about 42.3% of the state's population is still uncovered by health care, according to the status paper prepared by the Health Department. There are numerous hospitals being set up, both private and government, some of them are Civil Hospital, Ganesh Das Hospital, K.J.P. Synod Hospital, NEIGRIHMS, North Eastern Institute of Ayurveda & Homoeopathy (NEIAH), R P Chest Hospital, Wood Land Hospital, Nazareth Hospital, Christian Hospital etc.
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