J&K Has Potential To Become One Of India’s Economically Strong States

By Nantoo Banerjee

The restoration of statehood for Jammu and Kashmir, without the Union Territory of Ladakh, and an expected elected government by September, next year, come at a time when J&K has established its position as one of India’s top performing provinces in terms of economic growth. J&K’s state GDP is lately growing at the rate of 10 percent, annually. A key task before the state’s forthcoming elected government would naturally be to take the growth dynamics on a fast-forward mode and generate more employment and revenue. This should be more than possible. Till now, major contributors to the state’s economy have been agriculture, horticulture, tourism, handicrafts, limited scale of manufacturing and services. Its huge mineral resources remain largely untapped. The potential needs to be explored and exploited to push the manufacturing sector. This may require a change in the state’s land acquisition policy.

The state’s economic potential was never tested fully by its erstwhile politically volatile governments challenged by pro-Pakistan elements and cessationist groups taking advantage of the prolonged presence of Article 370 of the Indian constitution. The article gave special status to the originally designed J&K, a region disputed by India, Pakistan and China. The provision was drafted by N, Gopalaswami Ayyangar, a Constituent Assembly member, and was added to the constitution as a ‘temporary provision’ in 1949

For unknown reasons, the provision remained untouched until August 5, 2019, when the Parliament abrogated the article taking away the special status to J&K and bifurcated it into Union Territories of Jammu and Kashmir, and Ladakh. While Ladakh is to remain as a Union Territory, the government assured that statehood of Jammu and Kashmir “will be restored soon.” Last week, the Supreme Court held the abrogation of Article 370 of the Constitution valid and ordered the Election Commission to conduct elections to J&K Assembly before September 30, 2024. The apex court also directed the Centre for the restoration of J&K’s statehood.

The challenges before the new J&K government after the assembly election are going to be many. Among the most important of them are: improvement of law and order situation in the valley and creation of proper environment for social, educational, economic growth, and jobs for the youth. More jobs and more wealth with the local people are bound to improve the social and political environment. The new economic and industrial development policies need to be directed at utilisation of the hitherto untapped resources. J&K has India’s sole production unit of borax. Sitting on large sapphire resources, the state boasts of having several essential minerals such as coal, graphite, marble, gypsum, magnesite, and limestone.

India’s first and only lithium reserves to the tune of 5.9 million tonnes have already been discovered in the state. The union government eyes more lithium reserves in J&K. It has identified the presence of as many as 30 critical minerals. The state will need to work with both the union government and private sector entrepreneurs to tap these resources to grow as one of the country’s leading economies. Such initiatives are bound to have a positive impact on the society and help establish peace and security in the state. However, much will depend on political parties trying to come to power to rule the state. As for now, J&K is not doing badly on the economic front compared to many other states of the country.

In terms of per capita income, J&K is well ahead of Bihar, Uttar Pradesh, Madhya Pradesh, Jharkhand, Manipur and Meghalaya. There has been a consistent increase in the per capita income in J&K since the financial year 2011-12. It is moving fast to top the national per capita income average, which is now estimated at Rs.1,45,679. Currently, the per capita income of J&K is Rs.1,36,771 as against Rs.1,20,790, last year. Incidentally, according to the Ministry of Statistics and Programme Implementation, Telangana ranked first among all Indian states with the highest per capita income at current prices at Rs 3,08,732, followed by Karnataka with Rs 3,01,673 and Haryana with Rs 2,96,685. A NITI Aayog report shows that Srinagar is the richest district in J&K with only 1.51 percent underprivileged people. The state having a total population of around 1.36 crore is expected to have a gross GDP of over 2.30 lakh crore at the end of the current financial year.

However, it would be foolish to ignore the baggage the province was forced to carry since 1949 that primarily stood in the way of the state’s economic progress over the last seven decades. The state’s economic development will continue to face numerous hurdles such as the issue of political stability after the election, next year, future security concerns, poor physical infrastructure, land ownership issues, limited market access, large Hindu-Muslim divide, educational and skill gaps. J&K is a majority Muslim state. Islam forms the majority religion in 17 out of the state’s 22 districts. The state’s Muslim population is around 85.67 lakhs, representing 68.32 percent of the total population.

The Parliament is in the process of enacting a new legislation that seeks to reserve 33 percent of seats in the state assembly for women. The Jammu and Kashmir Reorganisation (Second Amendment) Bill, 2023, has already been passed by Lok Sabha. This will have an impact on the state’s future political leadership. The elected government in the state must try to resolve all the pending issues and obstacles in due course for the long-term prosperity of the people of Jammu and Kashmir. (IPA Service)