Last updated: Jan, 2024
Introduction
Sikkim is surrounded by vast stretches of Tibetan Plateaus in the north, the Chumbi Valley of Tibet and the Kingdom of Bhutan in the east, the Kingdom of Nepal in the west and the Darjeeling district of West Bengal in the south.
The state is richly endowed with rare and exotic flora and fauna, which includes 5,000 species of flowering plants, 515 rare orchids, 60 primula species and 36 rhododendron species. This makes it one of the leading states in the Northeast region in terms of production and supply of cut flowers to mainland consumer markets. Of the 6,000 medicinal plants in India, over 424 plants (including the famous Artemisia vulgaris that is used as an antiseptic) are grown in Sikkim.
Sikkim has several snow-capped peaks including Kanchenjunga, the world's third-highest peak, that attracts a large number of tourists from across the globe. Tourism in Sikkim has emerged as the new profession of the Sikkimese people with its vast natural potential. Promotion of village tourism, homestay, cultural tourism, trekking tourism, ecotourism, wellness tourism, flora-tourism and adventure tourism has given a fillip to the tourism trade in the state.
In September 2018, the Prime Minister of India, Mr. Narendra Modi inaugurated Pakyong Airport in Sikkim, the state’s first airport, which is expected to significantly boost the state’s connectivity. In 2022-23 (until August 2022), passenger and aircraft movements reached 10,543 and 222 respectively.
At current prices, Sikkim’s Gross State Domestic Product (GSDP) is estimated at Rs. 0.47 trillion (US$ 5.73 billion) in 2023-24. Sikkim’s GSDP is estimated to increase at a CAGR of 10.75% between 2018-19 and 2023-24.
In 2020-21, the secondary sector contributed 55.19% to the state’s GSVA at current prices. It was followed by the tertiary sector at 34.16% and the primary sector at 10.64%. At a CAGR of 15.45%, the primary sector witnessed the fastest growth among the three sectors between 2011-12 and 2020-21.
As of August 2022, Sikkim had a total installed power generation capacity of 704.72 MW, of which 75.92 MW was under central utilities, 415.11 MW was under state utilities and 213.69 MW was under the private sector. Of the total installed power generation capacity, 11.92 MW was contributed by thermal and 692.80 MW by renewable energy.
Sikkim has a suitable climate for agricultural and horticultural products. It supports multiple crops; viz., rice, wheat, maize, millet, barley, urad, pea, soya bean, mustard and large cardamom. Sikkim is the top producer of large cardamom, contributing over 80% to India’s total production. In August 2019, Sikkim was declared as world’s first 100% organic state by UN Food and Agriculture (FAO).
The government of India introduced the North East Industrial Development Scheme 2017, under which, all new industrial units located in eight northeast states in the manufacturing and services sector of the state were eligible for various incentives.
The state attracted Foreign Direct Investment (FDI) equity inflow worth US$ 6.35 billion between April 2000-September 2020 according to the data released by the Department for Promotion of Industry and Internal Trade (DPIIT).
Key Sectors
- In April 2021, the South Korean delegation—comprising senior officials of the Embassy of the Republic of Korea, Korean Trade-Investment Promotion Agency (KOTRA), Korea Start-up Centre, K-Sure and Korea India Research & Innovation Center (KRRI)—met Sikkim state minister of tourism & civil aviation and commerce & industries Mr. Bedu Singh Panth to explore the feasibility of investments in multiple sectors in the state.
- In January 2021, Chief Minister Mr. Prem Singh Golay launched ‘Visit Sikkim 2022’, a declaration on year-long tourism promotion and marketing for Sikkim. He emphasised having tourists in Sikkim for the whole year, instead of otherwise practised season-based tourism endeavour.
- The Union Budget 2021, allocated funds worth Rs. 581 crore (US$ 80.14 million) to the central pool of resources for the north-eastern region and Sikkim.
- In March 2021, the cabinet approved an estimated cost of Rs. 9,129.32 crore (US$ 1.26 billion) to strengthen transmission and distribution in Arunachal Pradesh and Sikkim.
- In the Union Budget 2021, the government allocated funds worth Rs. 1,100 crore (US$ 151.73 million) to the Sivok – Rangpo project (length: 44.96 kms) in Sikkim.
- In March 2021, CCI (Competition Commission of India) approved the acquisition of a ~35% equity stake in Teesta Urja Ltd. by Greenko Mauritius. Teesta Urja is a special purpose vehicle established to carry out a 1,200 MW hydropower project in North Sikkim.
- On January 13, 2021, NHPC Limited signed an agreement for the implementation of the ‘Approved Resolution Plan’ for the takeover of the 120 MW Rangit-IV HE Project of Jalpower Corporation Limited (JPCL) in Sikkim.
- In 2019-20, the total production of horticulture crops in the state was expected to be 409.57 thousand metric tonnes and the area under production was 102.71 thousand hectares. In 2019-20, the total production of vegetables and fruits was estimated at 231.40 thousand metric tonnes and 55.45 thousand metric tonnes, respectively.
- Sikkim's geographical and environmental conditions are conducive to the development of floriculture at a higher altitude. The state is also considered to be the Kingdom of flowers and is an innovator in cultivating Gladiolus.
- Tourism in Sikkim has emerged as the new profession of the Sikkimese people with its vast natural potential. Promotion of village tourism, homestay, cultural tourism, trekking tourism, ecotourism, wellness tourism, flori-tourism and adventure tourism has given a fillip to the tourism trade in the state where a large number of people are engaged under different employment opportunities. On January 30, 2019, Union Minister for Tourism inaugurated the first project under Swadesh Darshan Project at the Zero Point, Gangtok, Sikkim. The project was developed at a value of Rs. 98.05 crore (US$ 14.02 million).
- Sikkim is the only state which offers excise benefits and major players from the pharmaceutical industry have set up their manufacturing units in the state. A few of these are Cipla, Sun Pharma, Zydus Cadila, Alembic, IPCA, Alkem Lab, Intas Pharma, Torrent Pharmaceuticals, and Unichem.
FACTFILE
Capital
GangtokGeographical Area (sq km)
7,096State Language
Nepali, Bhutia, Lepcha, Limboo, Magar, Rai, Hindi and EnglishLiteracy Rate
81.42 per centKey Industries:
Tourism
Agriculture
Floriculture
Agro-processing
Hydroelectric power
Tea
Large cardamom
