Economy

The age old industry of the state is cottage industry  which plays a vital role in the village's economy. Cottage industries which deserve emphasis are (1) weaving and dyeing (2) work in cane (3) work in wood,  blacksmithy,  pottery and excavation of salt, pulp and paper mill.

Spinning and weaving were the only significant industry in the Naga hills until independence. The Aos, Rengmas and Lothas used to grow cotton sufficient, not only for their own requirements but surplus even to be given to the neighbouring tribes. In recent years, however, mill made yarn, by virtue of its easy availability and cheapness is steadily substituting the thread, spun locally. In course of time, indigenous spinning would probably become extinct unless the Nagas switched over to modern techniques. Weaving, however, continues to be popular. All Naga girls are expected to know weaving and they normally produce at home the necessary cloth for the family. Among the modern girls, the art of weaving is not particularly fashionable, though they know the working principles of it. The loom is a simple tension loom. It is exclusively a woman's possession and a man may not touch it. In fact, both spinning and weaving are the monopoly of women. In the head-hunting days, a woman was not expected to weave while her husband was on a raid lest his feet got entangled in jungle and he was killed by the enemy. Dyeing was also done by women only. A man who violated this rule, it was said, would not have any luck in hunting or fishing. Now a days chemical dyes are gradually replacing the indigenous colours.

The state is trying to encourage small-scale and cottage industries. This will reduce the pressure on land, ensure a larger employment potential and lead to a balanced regional development. Weaving  training-cum-production centres have been set up at Mokokchung and Dimapur, a Cottage industries training-cum-production centre has come up at Mon, and a cottage industries training centre at Aghunato. Industries like soap-making, candle-making,  bee-keeping are also being raised. A significant landmark has been the setting up of an industrial Estate at Dimapur.

Three medium-level industries have been established by the government for the development of Industrial Sector. The Nagaland sugar mill at Dimapur has an installed capacity of 1,000 tonnes of cane per day. There is a pulp and paper mill at Tuli and plywood  Factory at Tizet. In 1986, a Khandsari mill was commissioned. In 1988, a mechanized bricks plant was commissioned at Dimapur. A TV Assembly unit has also come up at Dimapur. These projects have provided employment opportunities to a large number of youths.

Trade

Earlier there was very little trade, except some in beads and shells. Now, Nagaland exports cotton, jute, timber, forest produce, chilies, and oil seeds and imports groceries and food stuffs, drugs and medicines, textile goods, utensils, furniture etc.