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Major industrial activities in J&K – I

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Major industrial activities in J&K

Dhaar Mehak M

Major industrial activities in J&K The economy of Jammu and Kashmir is known for its ironic characteristics. Being a mountainous region the agricultural potential does not go beyond subsistence. Climatic extremities with geographic remoteness limit the viability of the industrial sector. The services sector like the rest of the nation has been pacing up. The contrary facts include a low incidence of poverty in the region as compared to the rest of India. Low levels of inequality and possession of some or other assets by every household. All this comes in the business environment of fragility characterised by conflict. The major business shocks in the previous decade can be broadly summed up as (i) the 2010 agitation resulting in mass lockdown, (ii) 2014 flood, (iii) 2016 agitation, (iv) blanket curfew of 2019, and (v) ongoing sprouts of pandemic lockdowns since 2020.

All these features can be visualized through two lenses. The first and obvious one that of loss of economic opportunities. The second one not so obvious is the resilience that has developed among the people over time. Given the fragility in the region that has lasted for decades on a stretch, the businesses having the least shock resistance have ceased to exist and the businesses having the resistance to face the jolts and challenges have continued to exist.

The business viability in Jammu and Kashmir is focused on necessity-based goods over any other type be it non-necessity items or luxuries. Jammu and Kashmir continues to be a hotspot consumer economy feeding on the output from the industrialization process concurrent with the rest of the county. This increases the leakages from the local economy, boosting the rest of the nation. As a result, the overall growth in general and industrial growth, in particular, in a crippled form currently.

Every economy consists of the formal and informal sectors. On the same lines, the economy of Jammu and Kashmir can be bifurcated into the formal and informal parts when it comes to major economic activities excluding agriculture. Broadly the formal sector can be defined as the firms that are registered with the relevant government authorities and have fixed working hours and wages. This part of the economy is stark visible and open to scrutiny all the time. On the contrary, the informal sector is hard to locate and lacks features like formal registration, fixed wages and working hours, labour unions and formal channels of business.

State-level secondary data shows that the major economic activity that has continued over time in the formal sector is the manufacturing of insecticides, rodenticides, fungicides, and herbicides etc. The reason for the persistent survival of these units is the inelastic demand for their output. Jammu and Kashmir economy is predominantly an agrarian economy and lately has been turning into a horticulture economy. Given its association with the land, it is unmoved by factors like conflict and pandemics. Thus, the viability of this business in the region is the greatest with a fair possibility of supernormal profits given the excess of demand for the output as compared to the existing level of supply in the region.

This is followed by the flour mills. The demand for flour in the region is high as people habitually as a matter of culture consume approximately three teas a day. The tea in the region unlike the rest of the country is taken with either homemade or ‘Kandur’ made roti. This factor keeps the demand for flour inelastic in the region and the business turns out to be shock resistant. In the region, several households prefer to go directly to the mill and buy fresh flour than to buy the packed versions from the store. This business, though small in scale has sustainable potential in the region.

The manufacturing of allopathic medicines and allied goods is also a viable and sustainable business here. Given the necessity-based demand for the goods produced by these firms, no kind of shock impacts the demand for the medicines. In light of the harsh winter, a high-intensity conflict in the past and the current pandemic people in Jammu and Kashmir tend to hoard and stock medicines that last for more than a month. At the same time, the frequent change in weather throughout the year makes people more vulnerable to seasonal illnesses like flu and the common cold. This factor has always kept the demand for regular medicines high. The Kashmir region especially has a culture of having high-fat foods, dairy products, spicy and sweet foods all leading to diabetics and high blood pressure. These factors additionally contribute to the high demand for pharmaceuticals in the region.

Major industrial activities in J&K

The mountainous geography coupled with harsh climatic conditions increase the wear and tear cost of the transport goods. As a result, people have to take extra care of their vehicles. This increases the potential of the businesses to sustain that deal with the maintenance and repair of motor vehicles. One of the basic characteristic features of the local population, predominantly in the Kashmir region is owning at least one motorized vehicle per household. Given the experience of the locals with uncertainty and the frequent shutting down of the public transport because of the same has made the motorized vehicle a basic necessity in the region. The existence of more vehicles in a region points out the high demand for maintenance for the same thus the viability of the business in the region. Another business sector closely associated with the geographic, climatic and conflict-related conditions is the need and necessity of the Kashmiri households to have a permanent, pucca and owned roof over their head. This has spiked the demand for all the raw materials used in the construction of the house. Now that the construction process has modernized the demand for cement is higher than ever-increasing the viability of this type of business activity in the region.

Demand for power generators is high in the region because of the lack of regular electricity. Though Jammu and Kashmir has a very high potential for hydro-power, a number of technical and political factors have kept it from the Pareto-improvement. As a result, the region has been facing a severe shortage of electricity, especially in the winters. To keep the houses and offices lit and warm the demand for alternate sources has always been high. As a result, the viability of the firms manufacturing and assembling power generators is high in the region.

For the local youth seeking entrepreneurial ventures, the good news stand hidden as a blessing in disguise. The necessity goods industry has a huge scope of potential with the least risk of failure. The indigenous formal industrialization process in Jammu and Kashmir can begin with the startups producing the inelastic necessity goods.

While having more and different types of clothes is a luxury for people across most parts of the country, it is a necessity in this part. The frequent change in climate and four strongly different and influential seasons demand different types of clothes. Extreme weather in January declines to minus 10 degrees sometimes while summer goes beyond 30 degrees. The poorest of the poor need accommodating clothes. At the same time by tastes, an average Kashmiri is highly considerate about what (s)he wears. These factors have always sustained the viability of the clothing industry in the region. The demand is very high while the supply is extremely short. The clothes market of Kashmir has been the hotspot of producers across the country. Consequently, the importance and viability of this particular type of business can’t be ruled out from the high viability rating.

There are a limited number of places where the Willow tree grows. As a matter of comparative advantage, Kashmir is one such region. The highest demand for Willow wood comes from the cricket bat industry. However, the lack of relevant policy intervention from the government and a lack of market boost have crippled the sports goods industry in the region for a long time continuing to date. In light of the same, one of the prime business segments in the region is the sports goods industry. In the current state of affairs, the potential is very high but the current situation is way below efficiency. A relevant policy intervention can change the whole potential of this business and increase the overall viability of sports goods production in the region.

It can be concluded that the business viability in the region of Jammu and Kashmir is focused on necessity-based goods over any other type of good be it non-necessity items or luxuries. Jammu and Kashmir continues to be a hotspot consumer economy feeding on the output from the industrialization process concurrent with the rest of the county. This increases the leakages from the local economy, boosting the rest of the nation. As a result, the overall growth in general and industrial growth, in particular, is in a crippled form currently. However, for the local youth seeking entrepreneurial ventures, the good news stands hidden as a blessing in disguise. The necessity goods industry has a huge scope of potential with the least risk of failure. The indigenous formal industrialization process in Jammu and Kashmir can begin with the startups producing the inelastic necessity goods. … to be continued …

Specialising in the industrial process of J&K, the author is a Senior Research Fellow in the University of Kashmir’s Economics Department. She can be reached at dhaarmehak@gmail.com

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Economy

Editorial | J&K Budget 2025-26 – A Balancing Act

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J&K Budget 2025-26

Fiscal Constraints Amidst Development Aspirations

J&K Budget 2025-26

Preparing the maiden budget for Jammu and Kashmir as the head of an elected government of a state downgraded to a UT and remaining under central rule without an elected government for more than seven years with overwhelming challenges was an arduous task for Chief Minister Omar Abdullah.

While his speech paints a hopeful picture of a “new and prosperous” J&K, a closer look reveals a delicate balancing act necessitated by fiscal realities and the people’s aspirations: high hopes with vivid memories of recent election promises.

As Omar Abdullah seeks to lay the foundation for ‘long-term growth, stability, and self-reliance’ of J&K, he has to walk a tightrope to keep the state’s mounting debt under control. However, his prudent management to keep the fiscal deficit under leash has come at a cost: a leaner budget. This year’s budget allocation of Rs 1.12 lakh crore is Rs 6080 crore or 5% less than last year’s budget announcement of Rs 1.18 lakh crore. The reduction in budget allocation, along with 4-5% inflation, raises concerns about the government’s ability to realise its ambitious development goals fully.

The CM’s speech, though, outlines a comprehensive vision, touching upon crucial sectors like rural development, agriculture, tourism, and industry. But translating these aspirations into tangible outcomes requires substantial financial investment. Moreover, the pervasive challenge of inflation adds another layer of complexity. Rising prices erode purchasing power, making it harder to stretch limited budgetary resources.

As Omar Abdullah seeks to lay the foundation for ‘long-term growth, stability, and self-reliance’ of J&K, he has to walk a tightrope to keep the state’s mounting debt under control. However, his prudent management to keep the fiscal deficit under leash has come at a cost: a leaner budget. This year’s budget allocation of Rs 1.12 lakh crore is Rs 6080 crore or 5% less than last year’s budget announcement of Rs 1.18 lakh crore.

The emphasis on fiscal prudence, curbing non-priority spending, and enhancing revenue collection is understandable, given J&K’s historical fiscal stress. However, austerity measures must be carefully calibrated to avoid stifling economic growth and hindering essential public services, especially when inflation is already squeezing household budgets.

The budget’s focus on digital governance and healthcare accessibility is welcome. Initiatives like the SEHAT app and the expansion of digital services have the potential to improve efficiency and transparency. Yet, the question remains: are the allocated funds sufficient to ensure the effective implementation of these programs, particularly when the real cost of implementation is escalating due to inflation?

The agricultural sector, a cornerstone of J&K’s economy, receives significant attention. The success of the Holistic Agriculture Development Program (HADP) will be crucial in boosting farmer incomes and creating employment opportunities. The allocation to HADP has been reduced Rs 800 crore from last year’s 1000 crore plus. However, the program’s impact will depend on the timely disbursement of funds and effective implementation, and whether the farmers can see real increases in their income, that outpace the rising cost of goods.

Similarly, the ambitious plans for tourism development require substantial investment in infrastructure and marketing. While the government’s efforts to promote offbeat destinations and sustainable tourism are laudable, the sector’s growth will depend on attracting private investment and addressing critical challenges like sustainability and waste management, while also dealing with rising operational costs due to inflation.

Some headline-making announcements like free rides for women in public transport and 200 free units of solarised power for AAY population fail to impress the general public. The argument is J&K has almost non-existent public transport. About 850 public buses with a passenger capacity of 35,000 people do not even suffice the transport needs of the 1% of the 1.2 crore population of J&K. The 200 e-buses for two metro capital cities, announced in last year’s budget, failed to take route. CM has repeated the announcement this year.

The government’s commitment to empowering MSMEs and startups is also noteworthy. However, ensuring access to finance and creating a conducive business environment will be essential for fostering entrepreneurship, and this becomes more difficult when inflation creates financial uncertainty. In last year’s budget, a good amount was announced under Youth Startup and Seed Capital Schemes but both schemes failed to take off.

Also, the budget is unable to address the burgeoning unemployment that, as per some private surveys, has reached 32%.

Whatever the allocations, the success of this budget will be now judged by its ability to deliver tangible benefits to the people of J&K. While the government’s efforts to reduce the fiscal deficit are commendable, it must also prioritize investments that will drive economic growth, create jobs, and improve the quality of life for all citizens, while also mitigating the effects of inflation.

The challenge lies in navigating fiscal constraints and inflationary pressures while maintaining momentum on the development path. This budget sets the stage for a critical year ahead, one that will test the Omar Abdullah government’s ability to balance its books and deliver on its promises, in a climate of rising prices.

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Economy

SKUAST-K to hold mega Science Summit on Aug 23-24

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SKUAST-K Mega Science Summit

Srinagar, Aug 21: Sher-e-Kashmir University of Agricultural Sciences and Technology of Kashmir is hosting a mega first-of-its-kind science summit ‘Kashmir Science Vision-2024’ on August 23-24 at Shalimar campus. The event is expected to bring together leading scientists, researchers, policymakers, entrepreneurs and scholars to discuss and develop science and technology policy for the sustainable future of Jammu and Kashmir with a focus on helping the UT to emerge as a model for Viksit Bharat@2047.

The Kashmir Science Vision Summit will feature a dynamic range of keynote lectures, panel discussions and brainstorming sessions.

These discussions will focus on key areas of regional development like Scientific Innovations & Entrepreneurial Opportunities for exploring how technology can be harnessed to drive socio-economic growth and create new business opportunities, Biomedical & New-Age Sciences for advancing healthcare through innovative medical sciences and improving health outcomes for the region’s residents. Food Security & Sustainability for promoting sustainable agricultural practices to ensure long-term food security and environmental health, Biodiversity Conservation & Disaster Management for developing strategies to protect the region’s unique ecosystems and mitigate the impact of natural disasters will also feature in the two-day summit.

The summit aims to foster collaboration among diverse stakeholders to ensure that scientific advancements translate into meaningful benefits for Jammu and Kashmir.

Vice Chancellor SKUAST-K Prof Nazir Ahmad Ganai said the summit will serve as a catalyst for the region’s sustainable development and strategic growth. “It will be remembered as the spark that ignited science and technology-led future-ready Jammu & Kashmir,” he added.

Pertinent to mention, SKUAST-K is a premier institution dedicated to advancing agricultural sciences and technology. With a commitment to innovation and excellence, the university plays a pivotal role in fostering sustainable development and technological progress in the region.

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Trade

Lenskart enters Kashmir market, opens shop at Regal Chowk

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Lenskart enters Kashmir market

Srinagar: Lenskart, India’s leading eyewear brand, has forayed into the Kashmir valley with the opening of its first outlet at Regal Chowk in Srinagar city. This expansion marks a significant milestone for Lenskart as it continues its mission to provide vision correction solutions to every individual across the country and beyond.

With seven successful stores already established in J&K UT’s Jammu city and plans underway for another outlet in Sanat Nagar, Srinagar, Lenskart aims to extend its presence to every nook and corner of Srinagar city.

“We have plans to expand our reach into other districts of Kashmir soon, ensuring accessibility to quality eyewear products and services for all residents,” said Dr Mohammad Mutaher Zerger, who heads Lenskart’s Portfolio and Franchisee Business Divisions.

Dr Mutaher is a seasoned professional with extensive experience in franchise management. Having previously served at McDonald’s, the new head of franchise at Lenskart brings valuable expertise in expansion strategies and operational excellence. “We are dedicated to providing state-of-the-art sophistication in eyewear technology, coupled with unparalleled customer service,” he added.

Lenskart’s commitment to accessibility and affordability is reflected in its offerings, including the innovative Buy One Get One (BOGO) facility available at all Lenskart outlets and online. Additionally, the brand provides complimentary eye testing facilities, ensuring that customers receive comprehensive care tailored to their needs.

Lenskart enters Kashmir market

Lenskart Founder, Shark Piyush Bansal’s Vision is to give correction-less vision to the entire India.

In line with its dedication to innovation and excellence, Lenskart recently inaugurated a cutting-edge robotic factory in Bhiwandi, where lens production and fittings are carried out with precision and efficiency. This advanced facility underscores Lenskart’s commitment to leveraging technology to deliver superior-quality products to its customers.

Lenskart enters Kashmir market

With a network of 1800 stores across India and a growing presence in international markets such as Singapore, Saudi Arabia, Thailand, and the UAE, Lenskart is poised for further expansion into other countries in the Middle East and Asia-Pacific regions.

Lenskart’s entry into Kashmir signifies not only its commitment to providing vision correction solutions but also its dedication to empowering individuals with the gift of clear vision, enabling them to lead more fulfilling lives.

 

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