Since the economy of the North East is basically agro-based, the primary reason for its poverty is agricultural backwardness. The very fact that the region has to look after 3.8 per cent of India's population with only 2.7 per cent of national income earned by its economy shows what poverty-distance it has to meet in order to catch up with the rest of the country. The region's per capita income-distance from all-India average has increased from Rs 1,706 in 1993-94 to Rs 7,000 in 2005-06.
