The Assam–Nagaland hydrocarbon pact, a tripartite Memorandum of Understanding to facilitate oil exploration in the border area has been signed.
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The Assam–Nagaland hydrocarbon pact signals a deeper shift in the relationship between development and political resolution.
The tripartite agreement signed between the Centre, Assam and Nagaland to facilitate hydrocarbon exploration along the Assam–Nagaland border has been discussed largely in terms of oil, gas and mineral wealth. Yet the significance of the agreement lies not merely in what may be extracted from the ground, but in the logic that made the agreement possible in the first place.
For decades, the conventional assumption governing many disputes in the Northeast was straightforward: political questions must be settled before development can proceed. Territorial disputes had to be resolved. Ownership had to be clarified. Political agreements had to be concluded. Only then could economic activity move forward with legitimacy and certainty.
The hydrocarbon agreement appears to invert that sequence.
Rather than waiting for the complete resolution of the Assam–Nagaland border dispute or the final implementation of the broader Indo-Naga political process, the agreement seeks to create a framework within which development can proceed despite those unresolved questions. It represents a conscious decision to move before settling.
The logic behind such a decision is not difficult to understand.
According to Union Home Minister Amit Shah, the agreement could increase extraction capacity from the present 1,000–1,500 barrels per day by nearly tenfold. He also spoke of the possibility of recoveries exceeding INR 15,000 crore from a single field. For a country seeking greater energy security and a region seeking investment and economic opportunity, these figures are difficult to ignore.
From the perspective of the Indian state, resources that remain inaccessible for decades because of unresolved disputes represent not merely lost revenue but lost opportunity. Negotiations may continue for years. Governments may change. Political processes may evolve. Yet the resources remain underground. At some point, policymakers may conclude that the costs of waiting exceed the risks of moving forward.
This appears to be the calculation behind the agreement.
The Centre's broader approach to the Northeast has increasingly shifted from a security framework to a development framework. Roads, railways, trade corridors, investments and resource development have become central themes. The assumption underlying this approach is that economic cooperation can create incentives for political cooperation. Development is no longer viewed as the reward that follows peace. Increasingly, it is viewed as one of the instruments through which peace is consolidated.
Supporters of the agreement would argue that this reflects realism. Boundary disputes can take generations to resolve. Political negotiations often move unevenly. If development must wait for perfect consensus, development may never arrive. Under such circumstances, joint arrangements become a practical means of ensuring that opportunities are not permanently sacrificed to uncertainty.
Yet this logic is not without risks.
The discovery of commercially valuable resources can alter the very disputes it seeks to bypass. Land that once carried symbolic or historical significance suddenly acquires measurable economic value. Questions of ownership become questions of royalties. Territorial claims become revenue claims. Resource wealth can encourage cooperation, but it can also harden positions because the stakes become much higher.
This concern becomes particularly relevant when viewed through the lens of land rights and compensation. If boundaries are eventually settled, how will compensation be calculated? Will valuation reflect the worth of land before exploration or after resource discovery? Who possesses legitimate claims over revenues generated during the period of uncertainty? These are not secondary questions. They go directly to the heart of fairness and legitimacy.
The challenge extends even further.
The opposition expressed by the Working Committee of the Naga National Political Groups reflects a different understanding of the issue altogether. Their objection is not primarily about economic development. It concerns the relationship between resource extraction and the unresolved political negotiations between the Government of India and Naga political groups.
By invoking the 2017 Agreed Position, the NNPGs are effectively arguing that ownership and control of natural resources remain part of an unfinished political conversation. From that perspective, moving ahead with extraction before settlement risks creating economic realities ahead of political realities.
This produces a tension between two competing visions.
One vision argues that settlement should precede development because legitimacy provides the foundation upon which lasting development can rest.
The other argues that development should proceed alongside settlement because waiting indefinitely for complete resolution imposes costs upon everyone involved.
There is, however, another way to view the agreement. The conventional assumption is that development before settlement weakens the bargaining position of political stakeholders by creating economic realities ahead of political realities. Yet the opposite argument can also be made. Commercially viable hydrocarbons do not diminish the importance of the territory under negotiation; they increase it. Once a region is understood to contain resources worth thousands of crores, questions of ownership, authority and benefit-sharing acquire greater urgency. What was once a debate about territory becomes a debate about value. In that sense, the discovery and development of resources can increase the strategic importance of reaching a durable political understanding rather than reduce it.
From this perspective, the agreement may not necessarily represent a bypassing of the political process but a recognition that the economic stakes surrounding that process are growing. The more valuable the resource base becomes, the more difficult it becomes for any stakeholder to be ignored. Revenue sharing, royalties, compensation, environmental safeguards and local participation all become subjects requiring institutional arrangements and political consensus.
The hydrocarbons themselves do not create leverage. What creates leverage is the need to determine who has a legitimate claim over the benefits they generate. Seen through this lens, development and negotiation cease to be competing trajectories. Instead, development may increase the pressure to convert political understandings into implementable frameworks.
Neither position is entirely wrong.
The hydrocarbon agreement is therefore significant because it reveals a larger transition underway in the Northeast. The central debate is no longer simply about conflict. It is increasingly about implementation. No longer simply about sovereignty. Increasingly about governance. No longer simply about rights. Increasingly about how rights, development and political commitments can coexist within the same framework.
The most consequential aspect of the agreement may not be the oil beneath the ground.
It may be the decision that, despite unresolved borders, competing claims of ownership and unfinished political negotiations, the governments involved have concluded that the moment for waiting has passed.
The state has chosen movement over postponement.
Whether that choice ultimately produces consensus or contention will depend on how successfully development is balanced with legitimacy, and how effectively economic opportunity is reconciled with political commitment.
That is the real tension beneath the hydrocarbons. Not whether development should happen, but whether moving before settling can ultimately help achieve the very settlement it seeks to move beyond.
Limhachan Kikon