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Integration of Jammu & Kashmir to Indian Mainland Brings Uniformity to Economic Policies of Both Regions

Altering the long-held governance structure was just the beginning to resolving the long-standing Kashmir problem

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Jammu, Kashmir, Indian
Much has been discussed and debated over these decisions. Pixabay

The special status of Jammu & Kashmir has been revoked and the state has been bifurcated into two Union Territories. Those are the facts. Much has been discussed and debated over these decisions. But it is time to consider its future implications now. Altering the long-held governance structure was just the beginning to resolving the long-standing Kashmir problem. The real uphill task remains. How do these steps result in the development of Jammu & Kashmir and bring it closer to achieving peace and stability? That is the crux of the matter; the end goal.

A key enabler of these outcomes can be the achievement of higher economic growth and development of the region. The integration of Jammu & Kashmir to the Indian mainland brings uniformity to the economic policies of both regions. All laws applicable to other Indian states will now be applicable to it. This puts the region on a level playing field and allows faster percolation of decision making at the Centre down to the most granular level.

Earlier, laws passed by the Indian Parliament had to be separately ratified by the state legislature in Jammu & Kashmir, which caused immense delays in implementation and the region suffered as a result. For instance, a week after other states joined the GST network, the government of Jammu and Kashmir had to pass its own resolution to integrate itself into the national tax framework. And this was a law in which the former state had an interest in clearing. The gestation periods are much longer for other acts. As the Prime Minister pointed out, the Right to Education Act was still not applicable to Kashmiri students. Such limitations had impeded the decision-making process and prevented effective economic development.

The economic limitations were further exacerbated by Article 35A, which prevented non-residents from buying land in the region and availing facilities provided by the state government. When businesses could not acquire the most basic assets for setting up an enterprise, economic activity was bound to be muted. The very nature of legislation curbed economic development and, thus, eliminated all avenues of growth and prosperity that could have benefitted the Kashmiris themselves.

Jammu, Kashmir, Indian
The special status of Jammu & Kashmir has been revoked and the state has been bifurcated into two Union Territories. Pixabay

The extent of economic inefficiency that has existed until now with respect to Jammu & Kashmir can be realised from the fact that the region was the largest recipient of central funds until now with little to show for it. An analysis by the Institute for Competitiveness shows that between 2005-06 till 2018-19, Jammu & Kashmir received around 10.5 per cent of the central grants-in-aid, which was the highest among all states. The second-highest share of these central grants were received by the state of Uttar Pradesh at around 9 per cent. That these allocations are grossly disproportionate can be seen in the light of their population shares where Jammu & Kashmir is home to 1 per cent of India’s population while Uttar Pradesh is the country’s most populous state accounting for over 16 per cent of its population.

Not only has Jammu & Kashmir been the recipient of the highest share of central grants but is also heavily dependent on them as its own revenue-generating capacity has been fairly limited. In fact, more than half of the state’s revenue, or 53 per cent to be precise, are derived from the central grants-in-aid. If central taxes are taken into consideration, this share shoots above 70 percent.

Thus, its own capacity of generating revenue accounted for less than 30 per cent of its total revenue receipts. This is yet another reflection of the lack of economic exuberance within the region, which has stymied its government’s revenue-generating capacity through both tax and non-tax sources. Moreover, these funds have also not been managed well. Jammu & Kashmir has had a history of improper financial management with the ratio of gross fiscal deficit to the state’s GDP at an average of 5 per cent over the last four years against a national average of 3 per cent for the same period.

There have, however, been recent discussions that the former state was already quite advanced on certain social parameters. Life expectancy, for instance, is the third highest among all Indian states at 73.5. But, if a broader measure is considered like the Human Development Index, the ranking of Jammu & Kashmir has slipped two places from 9 to 11 between 1990 and 2017 with a current score of 0.68 that is quite close to the national average of 0.64. Thus, its performance has not been exceptional even on the social outcomes.

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It must be admitted that there is no surety that after coming under central control Jammu & Kashmir will perform better economically. But the opening up of the local economy to outside actors will be akin to India’s liberalisation moment of 1991 when it opened up its economy and integrated with the outside world. As the legal impediments to free movement of people and access to assets like land have been removed, the economic focus of the state can now be broadened beyond tourism and agriculture. Industrialisation can slowly expand its prominence in the local economy. Thus, the elimination of the special status and more centrality of governance should beget higher availability of economic opportunities and wider avenues of growth for the people for Kashmir who have been long denied of the same.

(Amit Kapoor is chair, Institute for Competitiveness. He can be contacted at amit.kapoor@competitiveness.in and tweets @kautiliya. Chirag Yadav, senior researcher, Institute for Competitiveness, has contributed to the article. Their recent book, The Age of Awakening, is now on stands.) (IANS)

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The Best Destinations for a Perfect Travel Experience

Here are some offbeat Indian destinations for backpackers

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Travel destinations
For millennials, travel is not just a means of escaping a busy lifestyle, but an end in itself. Pixabay

Millennials are seekers of wholesome experiences. For them, travel is not just a means of escaping a busy lifestyle, but an end in itself. It’s an essential part of life, not a break away from it.

In sync with the new taste and preferences of young adventure-seekers, the following places are rising up to the occasion by enhancing their travel experiences:

Wayanad- travel
Wayanad is the perfect travel destination for nature-lovers. Pixabay

Aurangabad
An exquisite confluence of history and culture, Aurangabad is home to the renowned Ajanta and Ellora Caves, a lot of old forts, art galleries, and museums. Besides this, the place is a bubbling, simmering pot of a range of dishes that no food-lover can afford to miss.

Mukteshwar
What could be better than mountains and peace? Mukteshwar is the stuff that a nature lover’s dreams are made of. It is the perfect place to chill alongside Nature within the folds of mighty mountains while enjoying the soul-soothing embrace of sunlight and the skin-tingling kiss of wintry waft. Mukteshwar is less than an eight-hour drive from Delhi, making it one of the closest hill stations to the Capital.

Wayanad
Wayanad is another treat for nature-lovers who also seek unique cultural experiences. Situated at a distance of 76 kilometers from the beaches of Kozhikode, the region is popular among backpackers on account of its near-perfect weather and scenic setting punctuated with dams, lakes, and hike trails. The town paints a quaint and soothing picture with the lush green of mountainous plateaus, picturesque jungles, and idyllic valleys dominating. Squatting atop the Western Ghats and enclosing part of the Nilgiri Biosphere Reserve, Wayanad is not considered the most beautiful district in Kerala in vain.

Alleppey- travel
Alleppey is a famous travel destination known for its backwaters and houseboats. Pixabay

Pokhara
Pokhara is often called the tourism capital of Nepal – and it is not in vain that it has received this moniker. It serves as a gateway to the renowned Annapurna Circuit, is among the most exciting paragliding destinations the world over, and offers the entrancing sight of the beautiful lake framed by sky-piercing mountains. What crystallizes its reputation as the ultimate ‘Adventure Land of Nepal’ is that it cuts a less busy version of Kathmandu while holding on its own as a must-visit backpacker’s paradise.

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Alleppey
It is only when one has explored the intricate network of waterways which can only have been knitted by Mother Chaos that one realizes that the tag ‘Venice of the East’ does Alleppey injustice. Perpetually carrying the fascinating look of a forest having just emerged from a spell of rain, the region is famous for its toddy shops, punted boats, coir industry, paddy fields, the floating villages, and houseboats! (IANS)