De-industrializing Kashmir

De-industrializing Kashmir

Mehbooba Mufti, chairing the 6th Industrial Advisory Council meeting, stated that the promotion and development of local industry is the thrust area of her Government. She added that, during the past two years, several incentives were provided by the Government to make the local industry self reliant and competitive. It’s not clear whether Mehbooba is basing her assessment on flawed inputs or mere rhetoric for the fact of the matter is that local industry in Kashmir is retarded and much of the decrepit and defunct nature of our local industry and industrial potential is artificial. The reasons are political. This may sound counter intuitive to many and fingers would be pointed to the ‘obvious’: landlocked nature of Kashmir, distance from ports and markets and paucity of natural resources other than water. All these are valid reasons but profound structural transformations have taken place in the world of both the 20th and the 21st century. These transformations have shifted the onus from comparative to competitive advantage and the bricks and mortar economic paradigm is gradually but inexorably giving way to the knowledge economy. The cumulative impact of these developments has entailed the break of the horizontally and vertically integrated industries and firms to what have been called ‘Global Supply Chains(GVCs). The GVCs are cross national and even inter sectoral supply chains that are spread all over the globe. Consider the example of a smart or an iPhone. It is designed in the United States , its component parts are made in other countries , it is assembled in China and marketed elsewhere. This is GVC in operation. All a society or a nation needs to tap into the GVC is human capital, state of the art infrastructure and other allied and supporting infra- the kind that leads to the compression of time and space- and allows an entity to tap into the GVCs. If this supporting infra- soft and hard- is provided in Kashmir then despite the impediments to building end to end sustainable industries, it can tap into the GVCs. But, robust industrialization in Kashmir would also entail the economic empowerment of Kashmiris. This might be frowned upon by powers that be given that once robust economic growth and upliftment happens in Kashmir, the people of Kashmir might stand up to these powers in a more robust idiom. Hence the, consumerization and consumption oriented nature of our economy which makes us all the more dependent. This, in all likelihood, is by design. Robust and deep industrialization of Kashmir then is a chimera and an illusion which assurances or rhetoric of politicians cannot obscure.

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