Economic Status of Jammu and Kashmir :

Jammu and Kashmir (J&K) is the union territory of India located in northern part and a global tourist destination. In addition to traditional recreational tourism, a vast scope exists for adventure, pilgrimage, spiritual, and health tourism. Jammu and Kashmir has become a Union territory with its own legislature. One of the stated reasons for bifurcating the erstwhile state into two UTs is the lack of economic and social development.

Per Capita Income :

J&K’s per capita income remained Rs 65,615 in FY18, which is well below the national average of around Rs 98,000. Despite the low per capita income, the poverty rate in J&K is 10.35 per cent, which is almost half of the national average of around 21 per cent. Human Development Index for Jammu & Kashmir, however, is higher than the national average. The minimum wage for unskilled labour is Rs 225 per day in J&K, according to the Economic Survey for 2018-19. Expenditure on the social sector in the last five years rose by 148 per cent to Rs 24,350 crore in 2018-19.

GDP of State :

The state’s tax revenue rose by 78 per cent to Rs 11,190 crore in the last five years whereas the non-tax revenue surged by 100 per cent to Rs 5,750 crore during the period. Despite the increase in tax collections, the gross fiscal deficit of J&K has been estimated around Rs 7,720 crore for the year 2018-19, which has shot up by 69.6 per cent in the last five years, according to RBI data. The economy is primarily services based and agri-oriented. The state’s GSDP grew at a CAGR of 10.30 per cent, during 2011-12 to 2018-19. The GSDP is expected to grow at 11.71 per cent (in Rs) by 2018-19 to reach Rs 1.17 trillion (US$ 16.74 billion).  The state’s NSDP increased at a CAGR (in Rs) of 10.02 per cent from 2011-12 to 2017-18. The state’s NSDP is expected to reach Rs 1.34 trillion (US$ 20.73 billion) in 2018-19.

Agriculture :

A vast natural resource base has enabled J&K to develop land for cultivating major fruits. With varied agro-climatic conditions, the scope for horticulture is significantly high in the state. Food processing and agro-based industries (excluding conventional grinding and extraction units) thrive in the state. J&K has an ideal climate for floriculture and an enormous assortment of flora and fauna. The state has Asia’s largest tulip garden.

Handicrafts :

J&K’s handicrafts are world famous and the traditional handicraft industry has emerged as a large industry. Due to its large employment base and exports potential, the industry has been receiving priority attention of the government. The state is also famous for its small-scale and cottage industries such as carpet weaving, silks, shawls, basketry, pottery, copper and silverware, papier-mâché and walnut wood. The cottage handicrafts industry provides direct and gainful employment to around 340,000 artisans. Total exports from Jammu and Kashmir stood at US$ 196.43 million during 2018-19. During 2019-20 (up to Oct 19), exports from the state stood at US$ 96.74 million.

The following are some of the major initiatives taken by the government to promote Jammu & Kashmir as an investment destination:

• A project namely Augmentation of Water Supply to Jammu City from River Chenab costing, Rs 886 crore (US$ 126.77 million) stands formulated for providing additional drinking water of 240 MLD to Jammu City which has been submitted to Ministry of Urban Development.
• J&K’s handicrafts are world famous, on the back of which, handicraft industry of the state witnessed huge growth.
• J&K has an industrial policy that offers attractive incentives along with a single-window clearance mechanism. Land is allotted at concessional rates in industrial areas on lease for 90 years.
• National Highway Infrastructure Development Corporation (NHIDCL) is developing five tunnels in the state at a cost of US$ 3.42 million. The tunnels will have all weather access and will be completed by 2024.
• According to the Department for Promotion of Industry & Internal Trade (DPIIT), cumulative FDI inflows, during April 2000 to June 2019, were valued at US$ 6 million.
•  2018, five investments of Rs 162 crore (US$ 23.18 million) were proposed and Rs 346 crore (US$ 49.51 million) proposed up to October 2019 in the state.
• The Kashmir region is known for its horticulture industry. The industry plays a vital role in the state’s economic development. Total production of horticulture crops in the state in 2018-19** stood at 3.96 million tonnes with 414.47 thousand hectares area under production.
• The state is a leading producer of apples and walnuts; the total apple production, in 2017-18P, stood at around 1.74 million metric tonnes.
• About 150,000 metres of silk cloth is produced per annum in J&K. During 2018-19(P), 118 MT of raw silk was produced in the state and had a production target of 170 MT for 2019-20(T).
• Tourist arrival in the union territory stood at 14.32 million in 2017(P) out of which 14.24 million were domestic tourists and 79.77 thousand were foreign tourists.