Dr. Pabitra Kumar Jena & Paris Prasher
Before the inception of terrorism in 1989, the economy of Jammu and Kashmir (J and K) was primarily based on agriculture. A diminutive role was played by industry in the economic development and the services sector was dominated by the tourism. J and K is known as, “Paradise on Earth” because of its unmatchable picturesque beauty, eye-catching landscapes, is among the most important tourist destinations of the world. J and K is to the Himalayas what Switzerland is to the Alps. It is also called as the, “Switzerland of East”. J and K consists of three regions viz. Jammu, Kashmir and Ladakh. All these regions are well known for tourism potential all around the world. Jammu, also known as, “City Of Temples” is an important destination for pilgrimage tourism. Some of the famous pilgrimage sites located here are Vaishno Devi Temple, Raghunath Temple, and Bahu Fort which attract tourists from across the world. Kashmir, known for its enormous natural beauty and landscape, pleasant weather and rich heritage has been one of the most preferred tourist destinations for over centuries now. Tourism is identified as the engine of growth and development of Jammu and Kashmir economy in general and Kashmir Valley in particular. The development of tourist industry can have a significant impact on the overall growth of the State, because of its ability to create direct and indirect employment, as well as growth in allied industries. But because of militant activities in the State since 1989 onwards, there was hardly any sector to talk of and that was a colossal setback to J and K economy.
History bears witness to the fact that whenever and wherever militancy or political movement found roots, the economy of that region became a major casualty. Terrorism, conflict and instability in Jammu and Kashmir have been a major obstruction to its development and progress levels. In J and K, due to terrorism, there is hardly any industrial sector to talk of (except few areas of Jammu region); the agricultural sector, though a predominant source of income and livelihood, fails to provide food security to the complete populace of the Valley. It is the tourism industry that fills this vacuum. It is no surprise that the tourism industry was given special status with a view to generate round the year activity. A special outlay of Rs. 22.06 crore was made available during the seventh plan period with which important schemes like Gulmarg cable car and development of wayside facilities were taken up. The result was that the tourist inflow made considerable upward movement in mid-eighties of the last century. In 1987, the last big season before the violence started, tourism accounted for approximately 10 per cent of the state’s income. However, with the advent of terrorism in the State since 1989 onwards the tourist trade completely collapsed. As per available statistics tourist arrival was 7.2 lakh in 1988 but saw a drastic dip in 1991 when it was a negligible 6,287. Violent protests, social unrest, terrorist actions, the perceived violations of human rights, or even the mere threat of these activities can all serve to cause tourists to alter their travel behavior. There are two things that are pre-requisite for tourists to visit a particular place and that is- 1) perceptions of political stability and 2) safety.
The effects from political instability such as armed attacks, bombings, attacks on tourists, wars, change in government, which impede the image of the destination through media reporting and government policies and even word of mouth reporting. The Valley of Kashmir has been inundated in a vicious situation since 1989, which jeopardised the sustainability of tourism industry. The political instability in turn has greatly altered the direction, flow, pattern and volume of tourists to the destination. By 1991 there was a virtual shut down of tourism sector, which impacted the economy of the entire state and oozed down to every household. Tourism and its related sectors were pummeled causing not only the creation of a negative Kashmir image but also loss of livelihood to those dependent on it-directly or indirectly. The handicraft industry occupies a significant room and is imperative to the economy of J and K as it provides employment to more than three lakh people. It is profoundly reliant on tourism for its survival because this sector is linked to the tourist influx. Tourists often purchase the world famous Kashmiri carpets, shawls and crewel embroidery. Besides, paper machine items, wooden art-ware and Kashmiri rugs have also been fancied by tourists who love to take them home as souvenirs. However, post 1989, the performance of this sector is also plummeted. The value of production has declined from Rs.154 crore in 1988-98 to Rs.150 crore in 1989-90. There has been a delicate downward trend in the production of handicrafts since militancy gained momentum. The production of handicraft sector has not flourished during this period. Afterwards, that the production of handicrafts shows an increasing trend up to the period of 2008. However, after the mayhem resurfaced during 2008 to 2010, the production of handicrafts has declined drastically i.e. from Rs. 1614.59 crore to Rs. 325 crore only. Coupled with allied sectors, the losses estimated by the tourism industry for 2010 were a monstrous 10 billion INR. Jammu and Kashmir State’s annual deficit brought to 220 billion INR ($4.8 billion) during the financial period 2009-10 due to these losses.
At international level, the 9/11 terrorist attacks on the US had declined the export of handicrafts by 20 per cent during the first eight months of the current financial year. During April-November 2001, all segments of the handicrafts sector have shown a decline in exports. According to provisional data provided by the export promotion council for handicrafts, exports declined by 20.97 per cent to $201.76 million. In rupee terms, the negative growth is estimated at 17.34 per cent. There is an ongoing conflict in the J and K after the killing of a militant of Hizbul Mujahideen, Burhan Wani. Tons of violent activities have taken place after this incident and it shook the State with an unnecessary anger. Educational institutions are closed in some parts of Kashmir region and students suffered unnecessarily in these regions. Services of IT sector are withheld in few parts of Kashmir Valley and in Poonch, Rajouri District of Jammu region. Therefore, these conflicts over the terrorist killing, hampers the economic growth and hence, economic development of the State.
The Organisation for Economic, Co-operation and Development in 1990, argues that sustainable development cannot be achieved without peace and stability, and peace and security are not possible without meeting the basic needs of the people. Terrorism anywhere in the world leads to turmoil and that affects the economic development. Due to terrorism and conflicts, there was a major blow to those sectors of the J and K economy that were linked to the money economy. J and K now lags far behind in the economic growth as compared to the national level.