How Kashmir internet shutdown has hit Valley industries hard

Internet unavailable in Kashmir since Modi govt scrapped Article 370. Kashmir Chamber of Commerce & Industry chief pegs losses at estimated Rs 10,000 crore.

Srinagar during the shutdown following the scrapping of Article 370 | Photo: Praveen Jain | ThePrint

New Delhi: From tourism to handicraft artistes weaving Kashmir’s fine Pashmina cashmere, and a recent crop of the Valley’s internet-based businesses — the ongoing internet shutdown has affected a string of industries and left a big hole in J&K’s economy, according to a local trade body.

Speaking to ThePrint, Kashmir Chamber of Commerce and Industry (KCCI) president Sheikh Ashiq Ahmed said the phone and internet shutdown imposed ahead of the revocation of Article 370 on 5 August has cost the state an estimated Rs 10,000 crore.

The biggest contributor to this loss, he added, was the continued curbs on internet connectivity.

If Ahmed’s estimate is accurate, the shutdown has taken a worse toll on Kashmir’s economy than the periodic internet restrictions imposed from 2012-2017 put together.

According to a 2018 report by Delhi-based think tank Indian Council for Research on International Economic Relations (ICRIER), internet curbs between 2012 and 2017 cost the state economy Rs 4,000 crore.

“If things continue this way then we expect losses to increase,” Ahmed added.

The figure of Rs 10,000 crore comes to around 7 per cent of the state’s GDP for 2017-18, which was Rs 1.41 lakh crore.

Mobile and broadband internet has been unavailable in the Valley since the government scrapped J&K’s special status and bifurcated it into two union territories.

While broadband connectivity has been restored in Ladakh and Jammu, all forms of internet remain out of reach in Kashmir as part of an attempt to prevent law-and-order situations over the Article 370 decision.

Security restrictions have been eased and postpaid mobile phone connectivity brought back to Kashmir, but there’s still no word on when internet will return.

Although this may be the longest spell of suspension for the Valley, the restive region is routinely stripped of internet connectivity amid disturbances and protests triggered by militants and separatists.

“In today’s times, the basic need of any business is the internet, which is missing on the ground,” Ahmed was quoted as saying by PTI. “We have conveyed it to the governor’s administration that the businesses will suffer in Kashmir, the economy will weaken, which will have huge consequences in the long run,” he said.

Tourism, handicrafts hit hard

Apart from the severely affected fruit trade, tourism, another mainstay of the Kashmir economy, has also been badly hit by the situation since August.

“Tourism was the first victim. There are around 1,100 hotels, mostly with zero occupancy,” said KCCI president Ahmed. “Some had taken loans for hotel renovations which will be hard to pay off.”

According to the J&K government’s 2017 economic survey, “Tourism sector accounts for around 6.98% of state’s GDP… and provides impetus to allied sectors like handicrafts, handlooms and transport.”

An executive handling reservations at a five-star luxury resort in Kashmir said occupancy was nearly zero per cent between 4 August and 10 October, when a government advisory against travel in Kashmir, issued in August, was withdrawn. These months typically see occupancy of 50 to 60 per cent, the executive added.

While more tourists have started trickling in since 10 October, occupancy for the month this year currently stands at 5 per cent of what it was in October 2018, the executive said.

Airline bookings to Kashmir were affected majorly as well as a result of the advisory, which was issued in the first week of August.

An August report in HinduBusinessLine cited Air India as saying the airline was flying to J&K at 60 per cent occupancy despite an uninterrupted service. An expert quoted in the report predicted the occupancy to drop further.

Kashmir’s celebrated artisans and handicraft artistes, who weave the world-famous Pashmina, are, meanwhile, paying a heavy price for the internet shutdown.

“There are 2.5 lakh registered weavers and artisans, 60,000 to 70,000 of them [have been rendered] unemployed,” said KCCI president Ahmed.

S. Gupta, the CEO of Jammu-based e-commerce site Kashmir Villa, which deals in Kashmiri goods such as Pashmina shawls and pherans, said business had slowed down.

“We can get customer orders because we are on broadband internet, but it is difficult to fulfil these orders. Most of our suppliers are small-scale craftsmen and artisans from Kashmir and communication with them is difficult,” he added.

“We have placed orders for winter fashions and products but it’s hard to find out when these orders will be delivered to us,” he said.

Javid Parsa, the Kashmiri founder of the eponymous food chain, claimed “all 10 physical outlets of the business in Kashmir have been shut since 5 August”. The last customer order received online was 4 August, he added.

The founder of another e-commerce site for Kashmiri goods said he was thinking of shutting down. “We ran for eight years but we are thinking of shutting down… the salaries have not been paid either,” the founder added. “You can’t run an internet company without the internet.”

“What is most affected by the internet shutdown is the new business generation which is down over 50 per cent,” said Aaditya Kitroo, co-founder of Srinagar-based Jos&fine, which deals in handcrafted Pashmina cashmere fabrics.

“The IT sector was slowly going up [before the shutdown],” said KCCI president Ahmed, adding that the sector and its local workforce will suffer because of the internet shutdown. “Our young boys and girls are literally lost. The work orders that came from places like America will now go elsewhere…”

‘Feelings hurt more than finances’

Kashmir divisional commissioner Baseer Ahmed Khan, however, said there is no restriction on businesses in the Valley.

“There is no restriction, shops are open and there is no shutdown,” Khan added. “If anybody says there is a shutdown then he is a fool.”

J&K Principal Secretary Rohit Kansal said the entire region of Jammu Kashmir and Ladakh is now “almost entirely free of restrictions”.

“There are no restrictions on shops and businesses… across Kashmir, many shops and business establishments are open… traffic is plying on the roads as well as on inter-district roads…” he added. “Landline phones and postpaid mobiles are fully functional.”

Although there is no government-imposed restriction on the opening of shops, a people’s curfew imposed in protest against the Article 370 move and the ensuing shutdown, continues, now reinforced by militant threats.

“Most shops are closed, only essential goods shops are open and that too for around four hours a day,” said an entrepreneur based in Kashmir.

Despite the substantial financial losses they are suffering, for the average Kashmiri, Ahmed said, their hurt feelings were a more pressing concern. “The sentiments of the people are hurt,” said KCCI president Ahmed.

“I am willing to suffer through it [this internet shutdown] this one time… provided that, in the near future, Kashmir becomes like any other normal place in the world,” said Kitroo. “It is not normal to have internet shutdowns like this extending for so long or so frequently.”