“The imports are worth Rs 1500 crore annually. Although we export vegetables worth over Rs 100 crore when there is bulk of production here which lasts only for a few months,” says the president New Kashmir Fruits and Vegetables Association, Imtiyaz Ahmad.

Hindustan Unilever Limited’s Kashmir distributor, Jan M Koul says, “HUL has a yearly turnover of Rs 100 crore in the valley and Rs 30-40 crore in Jammu, but still the C&F agency is Bhagwati Enterprises Jammu.” About a HUL C&F in Kashmir, Jan says that the company chooses not to establish one in Kashmir. “It is the choice of company and then the conditions may not be conducive for them to start it as yet.”

“There should have been at least 150 C&F agents in the valley but at present we have only 15 or so. All the C&F agents controlling around 98 percent of consumer goods are Jammu based and they – on Sangharsh Samiti dictates – stopped sending us the provisions that included baby food and medicines,” informs Dr Shah.

Some companies had resumed their supplies bypassing their C&F channels in Jammu after the blockade but this all was done under one time billing (supplying from non-designed spots) and not made a permanent feature.

On the eve of Kashmir’s plan to cross the LoC to neutralise the impact of economic blockade by rioters in Jammu, the then Home Minister Shivraj Patil told a crowded news conference in Srinagar on August 10 that “if fruit is not able to move out, the government will make purchases, the CRPF will buy it and it would be given to the school children”. Even after that, he said, if the growers still suffer losses, the government will compensate it. Till date, however, modalities for compensation have not been finalised as far as Kashmir is concerned.

However, the question remains: what ails the Kashmir economy that a highway blockade could potentially ‘starve the valley to death’ in just a matter of weeks? Last year, traders from Kashmir vowed to reclaim the status they enjoyed before 1989 but nothing was done on ground. The importance of the C&F facilities can be gauged from their potential to generate employment. Experts say that if all major companies that sell their products in J&K establish their C&Fs in Kashmir, it will generate employment for 5000 persons. Besides, it will reduce the dependence on the goodwill of Jammu traders for supplies.
Though traders in Jammu softened their stand after a boycott of Jammu goods by Kashmir traders, they justify retaining their control on trade quoting factors like uncertainty of situation and inaccessibility. “Kashmir is a place where you do not know what will happen next moment. So big companies prefer Jammu for their stock of supplies,” says Rakesh Gupta.

Sudhir Kumar adds to the argument. “It is the location of Jammu as an entry point that makes manufacturing companies to stock their supplies here. Besides, you have easy transportation facilities, all weather roads and connectivity that adds to its preference over Srinagar,” says Kumar.

But the ‘uncertainty in situation’ argument is seen flawed by traders in Kashmir.

Every month Kashmir consumes cigarettes worth Rs 37 crores, including three crores of imported brands. One company, Godfrey Phillips India Limited (GPI), has a warehouse in Kashmir. ITC (Indian Tobacco Company) has Rs 240 crores cigarette business in Kashmir besides Rs 100 crores for its food items. It too built a huge warehouse facility in Awantipur recently. ITC Commission and Forwarding agent Harpal Singh joined the 15 other C&F agents in Kashmir, whose operations have remained unaffected by the prevalent situation.

Scholars say that the problem can only be dealt with by promoting entrepreneurship in Kashmir as balance of trade is heavily loaded in favour of imports. “The problem with the economy of Kashmir is that manufacturing is not promoted here. Imports account for Rs 30,000 crores a year as against exports worth 6000 crores which mostly include horticulture and handicraft products,” says Aijaz Ahmad Rather, an economics scholar at Kashmir University. “Nothing will materialise till people are educated about self reliance and production of goods they use in bulk. For this civil society has to come forward.”

The total trade volume in J&K touches Rs 52,000 crore annually, out of which the yearly trade-exchange between Jammu region and Kashmir region is around Rs 27,000 crore. Experts claim that if Kashmiri traders reclaim the status they enjoyed prior to 1989, the traders in Jammu would incur a loss of Rs 11,000 crore out of the annual Rs 27,000 crore worth of trade between the two regions.


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