The Indian Economy Blog

November 15, 2007

Jammu & Kashmir: the readymade SEZ

One of the criticisms leveled against India’s SEZ policy is that the zones are too small to make a real difference. But there’s a very big zone that could be an SEZ, especially if the state’s politicians—who are all for ‘autonomy’—decided economic freedom is something that is well in their capacity to achieve. And set an example for the rest of India.

That’s one of the proposals Sushant Singh puts forward in his article on moving towards an endgame in Jammu & Kashmir:

…unemployment among the youth of the valley remains to be adequately addressed. Handing out of doles and packages to the state government and public sector institutions is not the solution. An alternative would be to incent the private sector, perhaps even outside the state, with an offset to employ a certain percentage of people from Jammu & Kashmir.

The idea of converting the entire state into a virtual special economic zone (SEZ) has been mooted. The state has a special status under the Indian Constitution. So do SEZs. What is required is the repositioning the state to one that leverages its special status to achieve socio-economic development.

It would also require a rebalancing the distribution of fiscal transfers from the central government between the public and private sectors.

This will undermine the separatists’ main economic grouse—step-motherly treatment by the Centre and no attempts at development in the state. [Pragati - The Indian National Interest Review]


  1. Obviously the author of this idea knows nothing about the politics, history or sociology of the state.

    The economic solution threatens the status quo in many ways.

    The comparison of Indian operations in J&K to that of the US in Iraq and Afghanistan is unfortunate and downright wrong. The Indian army is still local, answerable to the Indian government made up of party members who also make up the government of J&K. The Indian Army is not an alien force that is imposing a foreign agenda. The agenda of the Indian Army does include inputs from various sections and groups within J&K who have real political power in India. They are not some puppet government official playing government while the Army runs everything. The Indian Army is not “sucking” up everything civilian. This is such a bullshit comment. If you want to comment about Iraq or Afghanistan, make those comments directly. Don’t use J&K as a proxy to air out your feelings.

    SEZs are not going to solve anything. But if it brings some jobs good. But why do SEZs need to be set up? Why this need to circumvent the constitution? Its so interesting to see how the J&K constitution is being used as an opportunity to circumvent the Indian Constitution. I guess it would make for a good way to disenfranchise Labour in favour of Capital.

    PS: Some thoughts about the usage of English. A simpler style is much better.

    “Business folks sometimes use “incent” to mean “create an incentive,” but it’s not standard English. “Incentivize” is even more widely used, but strikes many people as an ugly substitute for “encourage.””

    Comment by HmmBut — November 16, 2007 @ 4:11 am

  2. Also anyone who knows the history of property acquisition during the Kashmir Rail project would not speak so blithely.

    Comment by Theo — November 16, 2007 @ 4:23 am

  3. In recent times, it seems like the IEB is doing a lot of promotion for the INI blog, probably because some writers are common between the two. On many issues, INI is usually very one sided in its approach and rarely brings anything new to the table except for promoting a commonly held point of view. It’s nothing more than a more ambitious version of most average or below average blogs in the Indian blogosphere. IEB on the other hand has been a respectable and good blog. This new tendency of IEB writers to promote INI as in is evident in this post is spoiling the quality of IEB since it’s trying to venture into areas it’s not good at. If the writers in IEB want to maintain their quality and I guess readership, they should stop trying to foray into politics which they obviously are not experts at and stick to economics which they are able to talk about.

    Comment by Doesitmatter — November 16, 2007 @ 8:17 pm

  4. Doesitmatter,

    It is entirely incorrect to attribute the decision to post or promote INI blogs to IEB as a whole. There are a number of bloggers here at IEB and they do not necessarily everything that is written on IEB.

    The decision to feature posts from INI blogs or “promote” them as you put it is entirely mine. So whatever criticism you have should be rightly directed towards me.

    I believe there are issues featured on INI blogs—as there are on other blogs and mainstream media sites—that might interest IEB readers. To the extent that I think they are relevant to IEB, I’ll continue to post them.

    But I’d be keen to know which ‘average or below average blog’ has proposed making J&K an SEZ, as that is the point made in this specific post.

    Comment by Nitin — November 17, 2007 @ 8:36 am

  5. Horrible quality of analysis! The post does not even deserve my effort to give a long list of key considerations before this pathetic idea is ever thought about.

    Comment by Dilip Sankarreddy — November 22, 2007 @ 4:10 pm

  6. i personally feel that the author might be right at certain times knoeing the thuth of SEZs. it is enough good that if someboby think like that leaving aside the factual realities . the creation of SEZ in kashmir can do the maricle and the crises of unemployment would be over. what is required is the hard and sound study of the thought given that maight have come for the first time. there is not everything that is challenged, if the rliance can go to southern parts of india with almost the same socio-economic conditions what is that which let him away from kashmir. the conflict may be one of the biggets bottlenecks in terms of security, then we cant ignore the naxals in south india much horrible manyn a times. threats are every, be it south or north, does it mean none is to take the laed,at least not go with this that ignorance is bless. we need to work , ways wll come smoothly.

    Comment by ajaz — December 26, 2007 @ 2:08 pm

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