SRINAGAR: The Kashmir Chamber of Commerce and Industry (KCCI) has started compiling a new report as its earlier report shows the status of the amount of losses in Kashmir since the abrogation on 5 August 2019 up to the end of November 2019. A senior member of KCCI told this newspaper that the scenario in Kashmir is dismal on the economic front as there is little economic activity in the valley. According to KCCI officials, if the Central government does not take serious steps to retrieve Kashmir’s economy, the valley would see one of the worst crises here. Job losses and non-performing assets (NPA) in banks have already doubled, they added.
“Job losses in the private sector alone have gone up to 1.25 lakh as per data till January 2020. This will go up in the coming months,” said a BPO operator in Kashmir.
The tourism sector in Kashmir has also gone downhill as in the first week of February 2020, the footfall of tourists has been almost nil and there has not been any further bookings. Faheen Ahmad, one of the travel agents in Srinagar, said, “We have always received a lot of bookings in February for spring tourism. However, this time till now, there have been almost no bookings.” Meanwhile, the banks have not made public their details of banking operations for the December 2019 quarter as traders and industrialists said that their non-performing assets got doubled by September 2019. They claimed that they cannot repay any loans and have nothing to cheer about in the coming months. According to bankers operating in the valley, the NPA accounts in the December 2018 quarter were only 5.03% and now, they are touching almost 10%.
While recently several restrictions have been eased by the Centre, there has been no progress in the pick-up in business activities here. Earlier, during periods of unrest in 2008, 2010, 2016, and during floods in 2014, Kashmir was always rescued by the special packages of RBI. These packages used to help the stressed assets to revive.
However, the latest RBI intervention in the Union Territory of Jammu and Kashmir has come with lot of restrictions and, hence, it did not help the banking sector to revive. According to the latest RBI intervention for impaired assets in Jammu and Kashmir, only small and medium categories of borrowers are eligible for the scheme.
After the intervention of administration, most banks in Jammu and Kashmir decided not to insist on any fresh security for stressed accounts and continued with an extension of security.
They also decided to enhance 10% of the existing limit. However, the borrowers in Jammu and Kashmir have appealed to the government to intervene under the Economic Rehabilitation Programme.
“We are doomed. The Centre has no money to revive our economy. We have huge debts of banks and very soon, there would be a huge crisis in Kashmir on the economic front. The BJP government at the Centre is aware about the crisis, but they do not want to intervene,” one of the office bearers of KCCI told this newspaper.