Jammu and Kashmir’s economy has long been caught between promise and paralysis. For more than three decades, the region has awaited a comprehensive industrial incentives package from the Centre, one that could provide the necessary thrust to revive industries, encourage entrepreneurship, and generate sustainable livelihoods. The absence of such a package since the early 1990s has left the UT dependent on government jobs and small-scale trade, neither of which can absorb the growing aspirations of its youth. As the union budget approaches, the expectation of a substantial industrial package is not merely about financial aid; it is about laying the foundation for long-term growth, stability and dignity.
The Union Government has proposed an allocation of Rs. 43,290.29 crore for J&K UT in the Union Budget of 2026/27, making an increase of nearly Rs. 2,000 crore over the current financial year. The increased allocation comes as the UT continues to depend heavily on central assistance for development spending and disaster mitigation efforts. This dependence presses for the urgency of a strong industrial push. A robust industrial base would diversify opportunities, creating employment across manufacturing, services, and technology. It would also revive sick units that have been languishing for years, ensuring that land and resources are not wasted but redirected toward productive ventures. Where revival is not possible, reallocating land to new entrepreneurs could inject fresh energy into the industrial landscape.
Equally important is the role of entrepreneurship as Jammu and Kashmir has witnessed a surge of interest in startups, particularly among its younger population. Institutions like the Entrepreneurship Development Institute have laid the groundwork, but their seed capital provisions remain limited. Expanding these resources would empower innovators to take risks, build businesses, and contribute to the local economy. The culture of entrepreneurship must also embrace failure as a learning opportunity, rather than a stigma. Global examples show that setbacks often pave the way for breakthroughs, and Kashmir’s youth deserve the same chance to experiment and grow.
The package must also address systemic barriers as red tape has long discouraged investment, with entrepreneurs losing valuable time navigating bureaucratic hurdles. A functioning single-window clearance system would be transformative, reducing delays and instilling confidence among investors. Infrastructure development; roads, power supply, internet connectivity; must accompany financial incentives, for industries cannot thrive in isolation. Without reliable logistics and energy, even the most generous package risks falling short.
Recent incidents of Kashmiri traders facing harassment outside the region have highlighted the need for inward-looking growth. A strong industrial base within Jammu and Kashmir would allow its people to thrive at home, reducing dependence on external markets for survival. This inward shift is not about isolation but about self-reliance. By building industries and startups locally, the region can strengthen its economy while still engaging with national and global markets on its own terms.
At the same time, expectations must be tempered with realism. An industrial package alone cannot solve unemployment or economic stagnation. It must be accompanied by reforms that empower educational institutions, foster skill development, and encourage private investment. The government’s role should be to create an enabling environment, while entrepreneurs and investors drive innovation and growth. Balanced policies that combine central incentives with local reforms will ensure that resources are used effectively and sustainably.