Uttarakhand, in spite of being a small state, has certain key features that make it distinct from other states of the country and highlights its potential for development. However, development has predominantly been in the plains, and the hill districts have been left behind. All the hill districts have subsistence farming as their main economic activity. Due to subsistence livelihood, migration and a remittance economy operate in the hill districts. They are land-locked with huge distances between the markets and resources. Because of these constraints, traditional agriculture cannot be the lead sector for development. Thus the state faces the challenge of promoting livelihoods to minimize migration through local employment and income generation, and to enhance the quality of life of people living in villages.