August 5th, 2019 marked the day that took the count of Indian states down from 29 to 28 and brought about two new additions to the list of union territories in the country. It was the day of abrogation of the two historic articles, Article 370 and Article 35A of the Indian constitution.
Article 370 of the Indian Constitution was a temporary provision that granted special autonomous status to Jammu & Kashmir. The article exempted J&K from the complete applicability of the Indian Constitution and allowed it to draft its constitution. It also restricted the Parliament from extending its legislative powers to the state.
Article 35A was the provision of the Indian Constitution that allowed J&K’s State Assembly to define who is and who is not the “permanent resident” of the state.
Huge debates and discussions are going on several platforms whether the government should have abrogated the articles but let us first understand what these articles have brought to J&K and what can be in store for the state now without these articles.
Overview of J&K Economy
Jammu and Kashmir’s economy is primarily based on agriculture and services. The key industries of the state are tourism, handicrafts, handloom, horticulture, food processing, renewable energy, and agriculture. Most of the private investments have also been in the small-scale units and cottage industries which centre around tourism and agriculture, in the manufacturing of products like jams, saffron, spices, fruit juices, carpets, shawls, pottery, and silk cloths.
Development Hindrance due to Article 370 and 35A
Education: While the students of the rest of the country enjoy the Right to Education, the same is not the case for the students of J&K. The reason being, the Act was not passed in the state legislature. This has deprived the students of the basic right to study and make a better future for themselves. In the higher education sector, while there are many private educational institutes in adjoining states like Punjab and Delhi, J&K lacks the private institutions of eminence, just because outsiders cannot own land as per the article.
Of 3.17 million young men and women in the age bracket of 20-34 years, only 13% is either a graduate or hold a diploma or a certificate. Moreover, as much as 26% of the state’s population in this age bracket are illiterate. As far as the higher education sector is concerned the state is even worse. As per the state’s 2019-2020 budget documents, less than 25% of pass-outs from schools enter a college.
Even the central Government’s schemes of Skill India and PM Kaushal Yojya have not been able to bring positive change in the state due to the hindrance that these articles have created.
Women Rights: As per article 35 A, a woman marrying someone from outside the state would not be entitled to the land rights and other benefits that a resident can avail. This was an injustice towards women.
Healthcare: Although Ayushman Bharat applies to the state, there is a lack of medical infrastructure and skilled doctors. The reason, as mentioned by Home Minister in parliament, due to Article 370 and 35A, many private companies don’t invest in healthcare, and doctors from outside avoid the state as they are not sure about their future in the state. Also due to huge turmoil in the state, almost 45% of the population is mentally ill- either probable depression or post-traumatic stress disorder.
Investments: As far as the formal corporate and large-scale investment is concerned, it has mostly stayed away because of the militancy that has gripped the state for almost three decades now. This lack of private sector investment has been one of the major reasons why J&K fares so poorly in terms of employment.
Employment: The lack of proper educational opportunities, poor private investments in industries and the hindrance caused by the militancy, the state has faced severe issues in employment. It has the highest unemployment rate in the country, of about 15% as against the national average of 6.4%, as per Centre for Monitoring Indian Economy. The Minimum Wages Act that is enjoyed by all the workers of the country is not applicable to the workers of J&K. This has led to the lower standard of living of the workers in the state, and several workers migrate to adjoining states for better prospects.
Flow of Investments
With the abrogation of articles, there is an expectation of the flow of investments in the state. The Central government has stated in the parliament that several initiatives will be taken to bridge the gap between J&K and the rest of the country.
Recently, President of Confederation of India, Uday Kotak proposes 10 point formula to power up new-formed Union territories. The plan includes sustainable development with tourism, infrastructure, horticulture, connectivity, etc.
At present pharmaceuticals and other companies like Radisson, Dabur, Coca Cola, and Berger Paints have an investment in Jammu and Kashmir. Lemon Tree, which already operates the hospitality sector in the region plans to extend. Leading Dairy producer Amul, and helmet manufacturer SteelBird expressed interest in setting up a new plant in the region. ITC, Tata Group, Suzlon Energy, Mahindra Agrotech, UltraTech Cement, etc are tapped by the Commerce and Industry Department for Investors Summit.
With the economies of two Union Territories opening now, efforts from local businesses, government and industry need to seed development in the region. Though revoking the articles brought the opportunity to better investment and direction from the Centre, bringing positive change and sustaining the development is the challenge. An increase in investment will require building trust with locals, securing secularism of the region, delinking the region from drugs and militancy. Development should go hand in hand with peace to ensure growth along with prosperity.
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