India Sees Once-Off-Limits Kashmir As Investment Frontier

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Indian authorities have characterized their surprise move to strip
Jammu and Kashmir’s special constitutional status as freeing the
disputed Himalayan territory from the bonds that kept it from
realizing its economic potential.

But the argument is flawed. The region already outperforms India on
measures such as life expectancy, literacy and poverty, and its
economy has been growing steadily this decade, despite frequent
skirmishes between militants and security forces that have temporarily
halted commercial activity.

Where the restive region has fallen behind other Indian states is with
private investment, and Prime Minister Narendra Modi and other leaders
of his Hindu nationalist government have made it clear that at least
one of their goals in asserting more control over Kashmir is in making
it a new frontier for growth as India’s overall economy experiences a
slowdown.

For decades, a separatist movement has fought Indian rule in Kashmir,
which is split between Pakistan and India and claimed by both in its
entirety. Some 70,000 people have died in clashes between militants
and civilian protesters and Indian security forces since 1989. Most
Kashmiris want either independence or a merger with Pakistan, which is
India’s bitter rival.

Modi’s government last week revoked Article 370 of India’s
Constitution, which dates to shortly after independence from British
rule. It gave Kashmir a greater degree of legislative autonomy and
kept outsiders from buying land or holding public sector jobs. Indian
lawmakers also stripped Kashmir’s statehood, splitting it into two
federal territories: Jammu and Kashmir, and Ladakh.

The authorities argued that Kashmir’s special status had cultivated a
sense of separatism that was easy for Pakistan to exploit but made
investing difficult. Home Minister Amit Shah said doing away with the
special provisions would “kick start” regional development.

Shah and others have said the central government has given $44 billion
to the region for economic development in recent years, but that much
of it has been squandered by corrupt politicians.

“The revocation helps break the monopoly that was set by the previous
lawmakers of Kashmir,” he said. “Industry, health care and education
in Kashmir was stalled due to Article 370,” Shah said.

Whether a majority of Kashmiris agreed remained unclear Monday, the
eighth consecutive day of an unprecedented security lockdown and
near-total communications blackout in the predominantly Muslim valley
of 4 million people. Schools and businesses are closed and public
assembly is banned, conditions that are expected to last through
India’s independence day on Friday.

But Kashmir’s pristine Alpine landscape, ski resorts, lake houseboat
stays and uninterrupted acres of apple orchards have long made it a
global tourist attraction.

Its rich soil produces some of India’s most famous exports, including
handwoven Pashmina shawls, basmati rice and saffron.

And Kashmir’s gross domestic product, the value of all the goods and
services in the state, has risen from $16.7 billion in 2012 to an
estimated $21.9 billion in 2018, according to state statistics data.
The economy was expected to expand by another 11 per cent this year,
according to a state budget document.

By contrast, the Asian Development Bank recently reduced its India
growth forecast for 2019 to 7%, from 8.2% in 2015, crediting the
slowdown to lower consumption and investment.

India needs to grow by at least 9% per year to reach Modi’s aim of
making it a $5 trillion economy by 2025.

With the law prohibiting outsiders from buying property in Jammu and
Kashmir now lifted, Indians from the rest of the country are poised to
purchase real estate and apply for government jobs there. Some fear
this may lead to a demographic and cultural change in the
Muslim-majority region.

The move neatly sets up an international investment summit the New
Delhi-appointed governor of Jammu and Kashmir has planned for October.

Gov. Satya Pal Malik told reporters in Srinagar last month that
interest in Kashmir was great, but that the special constitutional
provisions had put off investors.

“The problem is people can’t buy land,” he said.

Though the provision precluded outsiders from buying land, they were
able to lease it for up to 90 years, with the ability to renew.

“There was no constitutional regulation which was hampering investment
or setting up business in Jammu and Kashmir. It was more the peace
that wasn’t there,” said Afaq Hussain, director of the New Delhi-based
Bureau of Research on Industry and Economic Fundamentals.

“Peace is the imperative,” he said.

The post India Sees Once-Off-Limits Kashmir As Investment Frontier appeared first on Independent Newspapers Nigeria.

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