While introducing the recent historic changes to Article 370, which revoked the special status for Jammu & Kashmir, the Indian government said the move would encourage private investments in the newly-formed union territories of J&K and Ladakh.
And now in the first interview since that controversial decision, India Prime Minister Narendra Modi told ET that he is very confident that investments will flow in to Jammu & Kashmir. “In fact, leading entrepreneurs have already expressed their interest in investing in this region,” he was quoted as saying in a long interview which delved into things such as the economic slowdown, the credit crunch for NBFCs and tax changes introduced recently at the Union Budget and more.
Even before Modi’s interview, companies such as fitness and wellness startup Cure.fit, dairy giant Amul, hospitality chain Lemon Tree Hotels, and helmet maker Steelbird had announced plans and their willingness to enter the J&K region. However, the unclear situation on the ground has raised some questions about when these businesses can launch operations there.
According to government data, 10% of the centre’s funds have been allocated to Jammu and Kashmir between 2011 and 2016, however, the investments have never matched up to the government allocations.
The centre is now claiming that with Article 370 revoked, more startups and investors will enter the region to establish their operations. “Open minds and open markets will ensure that the youth of the region will put it on the path of greater progress. Integration gives a boost to investment, innovation and incomes,” the Prime Minister reportedly said.
“Investment needs certain conditions: stability, market access, predictable laws being some of them. The recent decision on Article 370 has ensured all these are present and so investment will definitely flow, especially since the region offers investment opportunities in various domains like tourism, agriculture, IT, healthcare to name a few.”
In line with the Prime Minister’s plan, cofounder of Curefit Ankit Angori had recently said, “The recent announcement from the Government of India potentially opens up opportunities for our business growth and also create job opportunities. We intend to foray with five cult.fit fitness centres and keep on working to expand our offerings.”
Earlier today, Reliance Industries chairman Mukesh Ambani has also said that the company will support the people of Jammu, Kashmir and Ladakh in their developmental efforts.
Will Business And Industry Come To J&K?
Thanks to being a hotbed of political unrest for decades, Jammu and Kashmir’s march towards commercialisation has been glacial. In October 2018, the state officially introduced a J&K Startup Policy, which aimed to inspire young entrepreneurs in the state to pursue innovation and create a conducive and vibrant startup ecosystem in the erstwhile state.
The policy was to help in accelerating economic growth while generating employment opportunities in J&K. According to the policy, which would have been valid for the next 10 years, startups will be provided a monthly allowance of up to $166.9 (INR 12,000) for a period of one year during incubation. It’s currently unclear whether the former state’s startup policy would continue under its new status.
Further, the central government is also reportedly looking to host an investor’s summit in Jammu and Kashmir in October. The plan for the summit is to host major industrial groups and unveil concrete ideas for investment in sectors including hospitality, pharmaceuticals, agro processing and healthcare.
While some media reports have claimed a state of normalcy in Kashmir, another set of reports also said that the newly made union territory in still under curfew, with sporadic reports of violence against protestors, which have been denied by the government. With communications to the valley and Srinagar cut off, there’s little in the way of confirmation to the conflicting reports emanating from the ground.
Jammu and Kashmir has in fact faced 53 incidents of internet shutdown in 2019 alone, with the latest one coming as Section 144 was imposed in the Kashmir Valley earlier this month. Since then there has been heavy deployment of local police and contingents of paramilitary forces, and a clampdown on incoming and outgoing telephone calls as well as internet communications. Even media reports have painted different pictures of the situation in the region.
But Modi did promise that “Better connectivity, better linkages and better investment” will come to the Valley and surrounding regions, which “will help products of the region reach across the country and the world, leading to a virtuous cycle of growth and prosperity to the common man.