Kashmir Impulse Desk

Srinagar, April 5

Leading industrialists in Jammu and Kashmir have issued a stark warning about worsening economic conditions, saying the prolonged conflict in West Asia is beginning to ripple through the region’s already fragile economy.

In a formal representation to the Industries and Commerce Department, the Federation of Chambers of Industries Kashmir said the effects of the crisis – now stretching beyond five weeks – are being felt across multiple sectors, from exports to tourism.

Businesses are grappling with rising input costs, supply chain disruptions and delayed payments, while tightening liquidity is compounding operational pressures, the group said.

The export sector, particularly Kashmir’s handicrafts industry, has been among the hardest hit. Industrialists said shipments remain stalled at various stages, leading to missed delivery deadlines and strained relationships with overseas buyers. 

Payment delays have further squeezed cash flows, affecting exporters, artisans and linked trades.

The horticulture sector is also facing mounting stress. 

Higher transportation costs, driven by rising fuel prices, have eroded profit margins and weakened the competitiveness of Kashmir’s produce in domestic markets. 

Given the perishable nature of the goods, delays in transit are directly affecting growers’ incomes and threatening related infrastructure such as cold storage facilities.

Tourism, another pillar of the regional economy, is beginning to show signs of slowdown. 

Industry stakeholders report cancellations and weaker forward bookings, attributing the trend to higher airfares and broader uncertainty.

At the same time, disruptions in remittance flows from Gulf countries have dampened household incomes and curtailed local consumption, adding to the strain on businesses.

The cumulative impact, industrialists said, is most severe for micro, small and medium enterprises, many of which are struggling to meet operating costs, service debt and retain workers. 

Without timely intervention, they warned, closures and job losses could follow.

Describing the situation as an “economic exigency,” the group called for coordinated action involving the Government of India and the Reserve Bank of India.

Among the measures proposed are regulatory relief for lenders, expanded access to credit and targeted liquidity support for smaller businesses. 

Sector-specific steps – including freight assistance for exporters, transport subsidies for horticulture and rationalisation of airfares – were also recommended.

On the financial front, industrialists urged a temporary moratorium on loan repayments, lower interest rates and enhanced working capital limits. 

They also called for a pause on coercive recovery actions under the SARFAESI Act, along with a transparent one-time settlement mechanism for stressed borrowers.

Additional demands included deferment of statutory dues such as goods and services tax, provident fund and employee state insurance contributions, as well as relief in power tariffs and expedited clearance of pending payments owed to businesses.

Industrialists cautioned that while the crisis has external origins, its consequences could be deeply local. 

They said that without swift and coordinated policy intervention, the region risks lasting damage to its industrial base.