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Agriculture is the main occupation of local people.
Rice is the main foodcrop produced in the area.
There are several large tea gardens in the vicinity of the town which attracts workers from all over the region.
Lumbering was a big sustaining industry till the Supreme Court clamped down on the industry during nineties.
There is also a bit of tourism in Pasighat, being the oldest town in Arunachal Pradesh.
Agriculture, Horticulture, and tourism continues to be the main source of economy for the town.

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