Srinagar: The two back-to-back lockdowns since August last year have brought even veteran Kashmiri businessmen to despair. They now speak of a “new business model” and “banks writing off their debts” as their only hope of survival.
Last year, due to the six-month lockdown that followed the abrogation of J&K’s special status in early August, the Kashmir economy suffered losses of nearly Rs 17,000 crore. This year, just when the business community was trying to get back on its feet, coronavirus struck and felled them again.
Now, 45 days into a curfew-like lockdown, the future seems so dark that they cannot see even a ray of hope.
“We are the world’s only community that has developed immunity against any kind of lockdown. But today even that immunity is failing us. We are exhausted to the core,” said former president of the Federation Chamber of Industries Kashmir , Mukhtar Yousif, a third-generation industrialist.
Yousif runs more than a two-decades-old electric company, Northern Engineers, which manufactures electric transformers, power transmission poles, and other equipment involved in electricity distribution and transmission. The company is the main supplier of such equipment to the J&K government. The lockdown ideally should have had no impact on his business, but that has not been the case, he says; the pending payments from the government have been delayed further, which has meant not just loss of interest but repayment of bank loans and paying of salaries at a time when there is no income.
More than two years have passed since Yousif’s company supplied T&D hardware to the government worth Rs 7 crore in 2017. The government still owes him Rs 2.5 crore of that. The nation-wide lockdown has made the likelihood of that payment even more uncertain now.
“The problem has aggravated because I took a debt of Rs 3.5 crore from the bank to make the supply on time. I still owe them Rs 50 lakh, on which I have to pay interest. Over the last two years, I have paid a lot of interest at many intervals,” Yousif said. “Now when I look at what I have made out of the investment, I cry. It is nothing. Paying interest for two years is not a joke.”
Apart from the payment to the bank, Yousif also has to pay his employees. “Imagine this is my state, but what about those whose business depends on market factors? They borrow from the bank, then pay back from their earnings. What would they pay when they have no earnings? They would have to pay additional interest while the loan is on. Meanwhile they have to pay their staff, feed their families, and maintain other expenses. They will go bankrupt, wouldn’t they?” Yousif said.
According to him, 95 percent of businessmen in Kashmir are indebted to banks. “They are on the verge of collapse,” he said. “The only way to get them back to work is to write off their debt. But the government is making them pay even the interest for periods during which the government itself made them stop work,” Yousif said.
For Dr Mubeen Shah, also a third-generation businessmen and former president of Kashmir Chambers of Commerce and Industry, the miserable condition of Kashmiri businessmen today is due to the “3,000 no-work days” they have endured in the past thirty years of conflict.
Dr Shah has himself lost his family’s well-established business which his grandfather had established, due to various factors, one of them being loss of business days. None of the five factories that his father ran, which includes factories manufacturing silk, cement, marble, and matches, is alive today. His dream of his company’s own hydropower project also could not materialise. Now he is in Malaysia, where he has successfully established a chain of lifestyle stores where he mostly sells Kashmiri handicrafts, and runs a restaurant of Mughlai food. Last year, he was arrested in Kashmir and kept in jail for four months.
“No business can survive under lockdowns and clampdowns. The government should compensate us for all the losses we have suffered because of them. Kashmiris should also think about new models of business that can sustain amid these situations,” Dr Shah told Kashmir Reader over phone from Malaysia.
Jammu and Kashmir’s economy has doubled to Rs 1.3 lakh crore in the last decade, but this is not an accurate estimate of growth, argues Dr Shah, because it is the value, not the amount, that matters of the wealth created over these years.
The current president of Kashmir Chambers of Commerce and Industry, Sheikh Ashiq, is more concerned about how businesses will be run when the lockdown is lifted. Businessmen in Kashmir, he said, have no money left. “Whatever they have left is getting exhausted in sustaining themselves and their employees,” he said.
Ashiq exports Kashmiri carpets to 22 countries. He has done no business since August last year. His preparations for 2020 were devastated by the coronavirus. Today, he believes, only an infusion of capital from the government into the economy can help. “Otherwise, life is going to be difficult,” he said.

Junaid Nabi Bazaz