Kashmir, often called the “Paradise on Earth,” has long been celebrated for its breathtaking landscapes, rich cultural heritage and profound history. In recent years, the region has embarked on a transformative journey towards economic revival, marked by significant growth and burgeoning opportunities across various sectors. This article delves into the multifaceted aspects of Kashmir’s economic resurgence, highlighting key developments, statistics in sight and prospects.
Historically, Kashmir’s economy was predominantly agrarian with agriculture and handicrafts as the mainstays. The region’s fertile valleys yielded abundant crops while its artisans produced world-renowned products like Pashmina shawls, carpets and papier-mache items. Tourism also played a pivotal role, attracting visitors worldwide to its serene landscapes and cultural sites. However, prolonged conflict and instability adversely impacted economic activities, leading to stagnation and limited growth.
In recent years, concerted efforts by the government and local stakeholders have catalysed a significant economic turnaround in Jammu and Kashmir. The Economic Survey Report for 2024-25 projects a real Gross State Domestic Product growth of 7.06%, with the nominal Gross State Domestic Product expected to rise by 11.19%, reaching approximately 2.65 lakh crore. This positive trajectory underscores the effectiveness of strategic policy interventions and development initiatives.
The tertiary sector, encompassing services such as tourism, trade and information technology, is anticipated to contribute significantly, accounting for 61.7% of the Gross State Value Added in 2024-25. The primary sector, including agriculture and horticulture, remains vital, contributing 20% to the Gross State Value Added. This balanced sectoral distribution reflects a diversified economic base, reducing over-reliance on any single industry.
Tourism, a cornerstone of Kashmir’s economy had witnessed a remarkable resurgence. In 2024, the region welcomed a record 2.36 crore tourists, including 65,000 foreign visitors. This influx had revitalized local businesses from hospitality to handicrafts and generated substantial employment opportunities. The successful hosting of the 3rd G20 Tourism Working Group meeting in Srinagar in 2023 further bolstered Kashmir’s global tourism profile. The resilience of Kashmiri people in the wake of terrorist activities and a yearning for peace and prosperity is bound to turn the tide, Yet again in favour of Kashmir Tourism.
Agriculture continues to be a linchpin of Kashmir’s economy, employing a significant portion of the population. The region is progressing toward self-reliance in vegetable production, achieving an output of 520 thousand quintals in 2023-24. Initiatives like the Holistic Agriculture Development Plan, which will invest 5,013 crores over five years, aim to add 28,000 crores to the Gross State Domestic Product and create 2.88 lakh sustainable jobs. These efforts focus on high-value crops, organic farming and modernized practices to enhance productivity and income.
The introduction of the New Industrial Development Scheme has attracted substantial investments with proposals worth 27,000 crores received in 2021 alone. This initiative fosters industrial growth, particularly in agro-based industries and food processing units, adding value to local produce and creating employment. Infrastructure projects such as the Jammu Semi Ring Road 98% completed and the Delhi-Amritsar-Katra Expressway, are set to enhance connectivity, facilitating trade and tourism.
The unemployment rate in Jammu and Kashmir has declined to 6.1% in 2023-24 from 6.7% in 2019-20. Establishing 40,778 self-employment units under various schemes has provided jobs to over 1.16 lakh youth. Additionally, the region’s startup ecosystem has flourished with a 287% increase in Department for Promotion of Industry and Internal Trade -registered startups since 2020, including 333 women-led ventures. These developments indicate a dynamic and entrepreneurial workforce driving economic growth.
Kashmir’s export sector has shown impressive growth, particularly in handicrafts. Exports of carpets, woollen shawls and papier-mache doubled over two years, reaching 1,162 crores in 2023-24 compared to 563 crores in 2021-22. This surge reflects the global appreciation of Kashmiri craftsmanship and the effectiveness of initiatives that promote local products in international markets.
Despite these positive developments, challenges persist. Inflation in the region increased to 4.5% in 2024 from 4.3% in 2023, slightly outpacing the national average. Ensuring inclusive growth, addressing infrastructural bottlenecks and sustaining peace are critical for continued economic progress. However, the current momentum, underpinned by strategic investments and policy reforms, positions Kashmir on a promising path towards sustained prosperity.
Kashmir’s economic revival is a testament to its people’s resilience and the efficacy of targeted development strategies. With robust growth across sectors, improved employment rates and enhanced infrastructure, the region is steadily reclaiming its status as a paradise of natural beauty and a burgeoning hub of economic opportunity. Continued focus on sustainable development, innovation and inclusivity will be pivotal in ensuring that this upward trajectory benefits all segments of Kashmiri society.
