The first elected government since 2018 has assumed office in Jammu and Kashmir under the leadership of Omar Abdullah. While governance has vastly improved in the last few years with schools functioning smoothly, roads reaching remote corners of the region and thousands of languishing projects being completed, the Union Territory continues to face several challenges. With large scale unemployment and a clamour for government jobs on the one hand, the fiscal situation continues to be fragile and requires urgent attention.

An epochal event is to take place in the developmental trajectory of J&K this year. The railway link between the valley and the rest of the country will become operational in the next few months.

The impact of this event has not been fully appreciated by our policymakers. J&K is the country’s largest apple producer with the total value of output being ₹10,000 crore. This is almost twice as much as the region’s tourism sector. The valley also produces other horticulture products like cherries, peaches, pears and oranges.

Market linkages

The price of fresh fruit is critically dependent on efficient linkages to the markets. The apple growers of Kashmir have seen the price of their produce getting affected due to transport bottleneck on the Jammu-Srinagar highway. The administration makes special arrangements to ensure smooth movements of trucks to the Azadpur Mandi in Delhi but landslides and other hazards sometimes lead to trucks being stuck for days together.

While the region has been seeing record influx of tourists in the last few years, this is expected to rise exponentially with cheap travel options being available. It needs to be kept in mind that railway connectivity sometimes has unintended consequences. The extension of the railway line to Katra resulted in decline in business for Jammu and the mushrooming of budget hotels at Katra.

There is, therefore, a need to fully comprehend the impact of linking the Kashmir Valley to the rest of India and also take effective steps to utilise the benefits which will accrue from it.

On March 7, the Prime Minister in a public meeting in Srinagar spoke about the Jammu & Kashmir (J&K) Bank.

The J&K Bank had been on the edge of bankruptcy a few years back. Loans had been extended to prominent business families in the valley without due diligence. NPAs were in double digit. There were also allegations of terror funding and the bank was about to collapse. The total business of the Bank had got limited to about ₹1.25 lakh crore with deposits of about ₹80,000 crore. The share price was at an all-time low of ₹12.

J&K Bank turnaround

The last few years have seen a dramatic turnaround. The recent Business Today Bank Survey ranked J&K Bank sixth among the mid sized banks. Profits have reached ₹1,700 crore. NPAs have more than halved to about 5 per cent and the share price has climbed to about ₹140.

The Bank is unique as it is the only one owned by a State/Union Territory (UT) government.

With a new elected government taking office, the contours of the relationship between Delhi and Srinagar would need to be reset. While Constitutional and legislative structures provide a framework, the working of political processes is moulded by the men and women who steer them.

Broadly speaking UTs are of two kinds, one with Legislature like Puducherry and the other without, like Chandigarh and Lakshadweep. There is also the unique case of National Capital Territory of Delhi. Keeping in mind the needs of a sensitive territory like J&K, the Union government may need to balance regional aspirations with national interests. This may include a stronger and more wide reaching role of the Lt. Governor.

The abrogation of the Article 370 has undoubtedly led to a welcome period of peace. It is now time for the new government to lay a firm foundation to prevent a return to the dark days of terrorism in Kashmir.

The writer is Secretary, Panchayati Raj. Views are personal