Source- Live Mint

Economic growth in terms of GDP from 2004-05 to 2013-14 was 12% per annum, at least 2 percentage points lower than the national average

Since 1989, terrorist activity and violence have shattered peace and disrupted economic stability in Jammu and Kashmir. The constant threat to economic resources from rising militancy has led to its over-dependence on central government funding. Economic growth of the state measured in terms of per capita gross domestic product (GDP) from 2004-05 to 2013-14 was 12% per annum, at least 2 percentage points lower than the national average. With this slow growth, the state could do very little to reduce the poverty rate during this period. As per the Tendulkar Committee’s poverty estimates, poverty reduction in the seven-year period since 2004-05 has been merely three percentage points, from 13% in 2004-05 to 10% in 2011-12, compared with an average decline of 15 percentage points at the national level. Though the extent of poverty (10%) in the state is not high relative to other states, a telescopic view shows chunks of poor population across the state. The eastern part of the state accounts for a large part of its poor population. The three districts, Jammu, Kupwara and Anantnag together account for one-third of the total poor in the state.Since the northern and western parts of Jammu and Kashmir are largely uninhabitable, big pockets of poor population may not be seen in those areas. Yet, a large segment of the population residing around the barren areas classified as forest in Ladakh and also the surrounding areas of snow-covered land tend to be extremely poor. Poor infrastructure is a significant correlate of high poverty. Indicus research on spatial data identifies low poverty rate in areas which are well connected with broad road networks and well served by other infrastructural facilities, such as educational institutions, hospitals and transport services. The frequent terror attacks in Jammu and Kashmir resulted in a huge cost burden both in terms of capital formation as well as rise in unproductive expenditure. The loss of government buildings, educational institutions and hospitals due to terrorist attacks in this decade itself has been significant. Poverty alleviation in the long term is highly correlated with the improvement in education system and facilities. The quality of education in the years of turbulence has also been seriously affected by indefinite strikes, intermittent closures and other disturbances. The literacy rate in the state at 43% is one of the lowest in the country. Micro-level analysis shows lower overall literacy rate, and a distinctively lower female literacy rate, in the high poverty zones. This is true of most states, but in Jammu and Kashmir, even the low poverty areas tend to have moderately low levels of educational achievement by women. There is a gap of 17 percentage points in male and female literacy rate compared to a 14 percentage point gap at the national level. Our analysis shows that in the poorest quarter of the areas of Jammu and Kashmir, the gap between male and female literacy rates exceeds 20 percentage points. Another distinct characteristic of Jammu and Kashmir is that wastelands account for 73% of the total area of the state. Barren, rocky land covering an area of 46,379.45 sq. km constitutes the major wasteland category. Coexistence of barren land and high poverty is a common facet of poverty in all states. People living near the barren land tend to adopt unsustainable practices and therefore remain locked in extreme poverty. The scenic beauty of the state has huge tourism potential that can be exploited profitably on an expanded scale. An evidently greater number of tourism-related locations in the low poverty zones confirm the fact that tourism can trigger overall economic expansion and lead to poverty reduction, and this is apparent from spatial analysis. Poverty rates are much lower in areas where tourism is higher. Law and order issues no doubt impact Jammu and Kashmir, but our analysis also strongly suggests that poverty is likely to be much higher in Pakistan Occupied Kashmir. We unfortunately cannot validate this. What this suggests is that despite law and order issues, if the government concentrated on the business of governance, life could be much better for the residents of Kashmir.