Abstract: Eastern region of Uttar Pradesh (U.P.) is an agrarian economy and demographic profile is predominantly rural in character with high level of poverty. Small and marginal farmers dominate the scenario of land holding. Main source of income of majority of population is agriculture. There are many districts in the eastern region of Uttar Pradesh, where agro-based industry could be established. Maharajnagar is the one district, where over 11.5 per cent of the total land of the district is covered by forest which offer very good potential for forest based industries. On the other hand, Sonebhadra district is rich in mineral and forest resources. Sonebhadra and Mirzapur can be developed on the basis of development of stone based industries.