Enabling Entrepreneurship

Unemployment, disincentivized entrepreneurship, corruption and the conflict in Kashmir are all very intricately linked. Ikhlaq Qadri brings us the highlights of an intense exercise suggesting ways out for the youth population of Kashmir.

Fostering the growth of 200 youth enterprises across Kashmir valley, the first phase of the SKYE project’s research agenda -The “Youth Entrepreneurship in Kashmir: Challenges and Opportunities” report was released on July 25 in the University of Kashmir.

The report presented findings from an extensive research effort conducted across the ten districts of Kashmir by engaging young people in tailored market studies to analyze and understand key factors that are critical to boost youth entrepreneurship in Kashmir. Besides creating awareness about the entrepreneurship, SKYE project will launch a regional “Start-up Kashmir” network for young entrepreneurs.

Studying the issues hindering self-employment, the report suggests ways forward for building an ecosystem that can support youth start-up entrepreneurship in the Kashmir valley. It will help aspiring youth start-up entrepreneurs to match their interest, skills and resources with live opportunities in the local market.

“Even a few hundred first-class entrepreneurs could change Kashmir’s destiny,” reads the report.

The 30-month SKYE project funded by Scottish government’s South Asia Development Programme seeks to help, build and catalyze a youth-focused start-up ecosystem. It will deliver an integrated and targeted response to a specific set of barriers related to the business-enabling environment and the lack of specific initiatives, expertise, capacities, skills and coordination that impede youth entrepreneurship.

Victim of complex conflict and prolonged instability, unemployment in Kashmir is spreading. The research reveals that a few available jobs in the market are often filled through elite connections and nepotistic measures.

Kashmir is experiencing a “youth bulge,” where 71 per cent of the population is under the age of 35. Of the large group of youth between the ages of 18 to 30 in the Kashmir Valley, an estimated 48 per cent are unemployed.

In a survey conducted by the Chatham House (UK), 96 per cent of respondents from the Kashmir Valley identified unemployment as one of the main problems facing Jammu & Kashmir, along with conflict and corruption.

Official data suggests unemployment has started to rise from year 1993. The findings of the report suggest that the conflict in valley has made the people to have discriminatory behaviour towards employment. Government workers get paid even when roads are barricaded, curfews are imposed or strikes are called.

Therefore, public sector jobs are perceived as “stable” jobs, although the supply of such positions remains consistently low and unattainable for the most.
On the opposite end of the spectrum, the private sector is perceived as risky and unstable.

The number of job-seeking youth today is now more than the total number of employees the J&K Government has engaged over the last 60 years.

Mercy Corps compiling the details have estimated that the 2008 unrest in Kashmir alone caused economic losses of more than 10,885 crore rupees amounting to more than 27% of J&K’s State Gross Domestic Product (SGDP). Repeated shocks like these have so far scared away prospective investors and made entrepreneurs cautious.

The conflict is seconded by the rampant corruption prevalent in the state. “A 2008 survey conducted by Transparency International India put Jammu & Kashmir in the “alarmingly corrupt” category. As one Kashmiri youth interviewed in the report said, “The corrupt are not looked down upon in Kashmiri society where monetary affluence is a measure of one’s success.”

In Kashmir on an average young people are almost three times more likely to be unemployed than adults. The report suggests entrepreneurship can provide a successful route to long-term participation in the job market and as such can be an engine of economic growth and social cohesion.

The Kashmir’s youth bulge is creating an expansion of a workforce that has fewer children and elderly to support. This trend  may provide window of opportunity to focus on other things, such as building human capital and developing new business ventures. With the right investment and support, Kashmir’s Youth bulge could eventually yield a demographic dividend in terms of increased productivity and economic growth.

“Kashmiri youth are highly resilient, educated and motivated but currently lack key skills needed to compete in the 21st Century and face a acute scarcity employment opportunities in both the public and private sector,” the report has identified.

Negating the myth that in Kashmir there are no Entrepreneurs, the SKYE Project’s research has identified hundreds of successful Kashmiri entrepreneurs who have overcome the challenges of doing business in Kashmir- a conflict zone. These Kashmiri entrepreneurs not only achieved financial success for their companies, they have helped put Kashmir on the map and have contributed to job creation and economic growth.

Many inspiring stories of Entrepreneurs who started from scratch and now are the market leaders are documented in the report. Muhammad Amin son of a farmer from south Kashmiri’s Islamabad left a government job to start his company National Masala Mills with loan of Rs 5000, taken from his uncle in 1971. National Masala Mills is now a   US $ 22 million company and a household name across the globe-Kanwal.

“Kanwal is a story of pure Entrepreneurship,” says Farooq Amin, son of senior Amin and the present CEO. And it is not a lone story.

To understand the ecosystem for youth entrepreneurship within Kashmiri context and develop a primary and secondary research methodology Mercy Corps had detailed  consultations with a diverse cross-sector network of experts in Kashmir and an extensive review of research studies conducted across the globe with a similar scope.

A SKYE Baseline Survey was carried out across all ten districts of the Kashmir Valley. The sample size of the SKYE Project Baseline Survey was 1000 randomly selected Kashmiri youth between the ages of 18 to 30 years (100 respondents per district). Equal representation was given to youth of rural and urban area.

To know the readiness among youth a survey was conducted. The results were not encouraging. Of all youth surveyed the report recorded; 7% said they have all the knowledge about the basic requirements needed for starting a business, 28% said they have knowledge/awareness about existing successful entrepreneurs/ enterprises in Kashmir, 4% said they have participated in entrepreneurship development programs (training, etc.) available in the state.

The intentions of youth going for entrepreneurship are more encouraging; “45% of all youth surveyed said they would prefer to be self-employed, 57% of all male respondents said they would prefer to be self-employed (60% Urban Males and 55% amongst Rural Males) 33% of all female respondents said that they would prefer to be self-employed (38% amongst Urban Females and 27% amongst Rural Females).

The SKYE Baseline Survey reveals some fears in starting entrepreneurship; Ongoing Conflict, Financial Risk, Corruption, Lack of skills, Administrative hurdles, Stigma of failing & Market demand, Gender Discrimination, Competition, Social risks/costs and Workload.

In the SKYE Baseline Survey 73 per cent of youth surveyed said that they face social barriers to entrepreneurship in the Kashmir Valley. Nearly 52 per cent of the surveyed youth said their parents were not supportive of entrepreneurship.

Many Kashmiri youth feel defeated by the current educational system and acknowledge a gross mismatch between outdated university curriculum and the demands of local employers. One MBA student shared his frustration with Mercy Corps. “Most of us are one-track. We’ll look for government jobs or possibly jobs in banking or maybe insurance. I am personally very interested in starting a business. But our program trains us to be managers, not entrepreneurs.”

The  report looks at the challenges and opportunities affecting aspiring youth start-up entrepreneurs in Kashmir through five factors that are crucial in boosting youth entrepreneurship here. They are:  Social/Cultural Legitimacy & Acceptance, Entrepreneurship Education & Training, Business Assistance & Support, Access to Finance and Administrative and Regulatory Framework.

The hope with which the Mercy Corps formulated its report is that it will find its way in the corridors of power and to the offices of stakeholders. That will enable the young Kashmir to move towards prosperity and better future.

Mercy Corps- an international development agency is helping people all across the world’s toughest places. In Kashmir Mercy Corps seek to help Kashmiris build a more secure, productive and just community for themselves.