Company Bahadur of Kashmir

Greater Kashmir

When administrative rationale and bureaucratic reasoning is used to justify ideological agendas and political decisions, it ceases to be funny. It is farcical.  To say that 90 per cent of land in J&K is not for sale, is an unenlightening statement; factually correct, inferentially wrong. There is now not even a fig-leaf of protection. The territory of what was an empowered state is now being transformed into a land market; that too not laissez-faire but government determined.

The physical geography of J&K is such that while 20 per cent area of the erstwhile J&K state was under forests, now it has become about 50 per cent. Before the overzealous bureaucracy takes credit for afforestation, it must quickly be clarified that the reason is that Ladakh is not a part of the new entity.

To the area under forests, if the agricultural lands (which, by the way, can be sold to outsiders with the permission), the ecologically sensitive zones and the other regulatory protected areas are added, there is very little land left. Indeed, 90 per cent of land not being available for sustainable livelihood and developmental needs, was one of the reasons to put heavy barriers on land. Even within this protected system, there was an open system backed with incentives in the form of land for industry right from 1929 till date.

The problem is more acute in Kashmir which has just over a third of the total area of the UT with two-thirds of its population. It is a land scarce, capital constrained economy. Over the years, thanks to the intensive financial intermediation by J&K Bank, capital has become more available, even accessible. However, the limited size of the land market has been constricting as a binding constraint. This has resulted in an asset price bubble in the land market; land prices are completely out of line with other economic parameters making the land dynamics very complex and far reaching.

Added to this physical constraint is the opportunity cost of land in Kashmir for industrial use. Unlike elsewhere, it is very high because of a vibrant and profitable commercial horticulture which sets the floor. With minimum use of capital, mostly cash credit limits, the land based businesses have an internal rate of return which compares quite favourable with the manufacturing industry. This makes the transition to manufacturing less attractive and so also the entry of new players on profitability considerations.

It is for these reasons, along with the abysmally low level of basic infrastructural availability, be it power or logistics, that despite giving domestic industry enough and more incentives, both qualitative and quantitative, investments didn’t flow. The Chenab Textile Mill set up in the mid-sixties is perhaps still the largest. If anything, the subsidy given and the revenues forgone to attract investments is far more than the total investment deployed in Kashmir.

Now, the primacy given to “strategic” concerns over local socio-economic imperatives will be a huge deterrent to any investment, besides putting the local society under siege. Akin to being the AFSPA of land laws, a provision empowers the government to declare any area in J&K as ‘strategic’ and intended for the direct operational and training requirement of the armed forces at the behest of an army officer.

Apart from opening up the land market with complete disregard for its disruptive social and economic implications, the modalities of liberalising are unprecedented in the country; not only in “special” states like the North-East or Himachal Pradesh but even in mainland industrialised states like Maharashtra or Tamil Nadu.

A case in point is the setting up of a Jammu and Kashmir Industrial Development Corporation (JKIDC). Ostensibly created for “the rapid and orderly establishment, and organisation of industries in industrial areas and industrial estates”, it has near monopoly rights to “acquire” and “hold” “property, both movable and immovable” and “lease, sell, exchange or otherwise, transfer any property held by it”.

Beyond these land-bank powers, the JKIDC has been given vast powers virtually making it a state unto itself; state within a UT. In the matters of land, the JKIDC is even more powerful than the government. The government, for instance, is subservient to the corporation for having to make land available for it to distribute. Even while giving financial support to it, the Government has to consult the corporation on the terms and condition of grants, subventions, loans and advances. All its borrowings, including those in the open market are government guaranteed. Except section 22T, it can even accept deposits.

If the Corporation cannot acquire land by agreement, it can use Government to proceed under the Land Acquisition Rehabilitation and Resettlement Act, 2013 for acquiring it.

The Corporation is so empowered that it can “depute a police officer by written order” to do its bidding. Its decisions have been kept out of the purview of even Courts: “no Court shall take cognizance of any offence relating to property belonging or vested by or under this Chapter in the Corporation.”

With all these powers, it will easily be the most powerful corporation in the country.  It will not be long before JKIDC will become the “Company Bahadur”, as the private dominion of the East India Company was known. While the company paved the way for making India a territorial dominion of the British Empire, the JKIDC will pave the way for making Kashmir, which incidentally is a part of this country, into a dominion of large corporates and the well-heeled from outside of Kashmir. It will be a private dominion of the elite civil society of India.

This is nothing but corporatisation of the state, of which JKIDC is a prototype.  A new model of coercive corporatism — a troika of political ideology, market dynamics and bureaucratic structure – under the control of the national business is being experimented with. While corporates have played a huge role in nation building, this is one kind of a project that they would have never ventured into.

The state corporatism is going to change the organisational structure of the society by delinking home grown businesses from the local society. The only people who have invested so far in the valley, the local business class, will either be pushed to the margins or become comprador. This will lead to a social disarticulation of the Kashmir economy.

All this is quite apart from the questionable strategy of industrialisation being planned. The visionary policy makers of Kashmir, busy announcing every initiative as “first time ever in J&K”, don’t seem to see where the world is headed. The world’s largest taxi firm, Uber, owns no cars. The world’s most popular media company, Facebook, creates no content. The world’s most valuable retailer, Alibaba, carries no stock. The pre-Covid world’s largest accommodation provider, Airbnb, owns no property.

Or for that matter the new Environment, Sustainability and Growth framework that is now in vogue all over the world. This is especially important since India’s ecological and climate change vulnerability lies in this himalyan belt. Srinagar is among the 100 cities in the world which are facing the greatest water risk from melting of the Himalayan glaciers.

With the SDG 2030 being a global commitment, the world is transitioning into a post-carbon regime by redefining the production processes. Why not get plugged into these through an appropriate developmental policy for the future.

There are massive investments happening in all these businesses, not in land and physical assets but in building platforms and partnerships, forming networks, creating communities, leveraging technology, using and sweating existing assets independent of their ownership and fulfilling customer needs.

In this emerging world of shareconomy, it is more meaningful and beneficial to seek investments for developing the valleys of Kashmir as a post-carbon energy hub for the subcontinent, or use it as the gateway to open up Central Asia. The old geopolitical order has undergone a huge shift in the last one year and realignments can be made keeping trade and developmental issues at the core.

The way it is going, even as the post pandemic world will bid goodbye to the vertically integrated heavy asset based industry, the national leadership will relaunch the Second Five Year Plan of India of 1950s in Kashmir in 2020. Not to be left behind, the political leadership of the state also wants to go back to the 1950s in terms of the constitutional position. Between the two, Kashmiris are condemned to live in a present, wherein they aspire for the past as future; a past that has been ravaged and a future which is under siege.