Shahzad Ahmed and Ambreen Shah
Srinagar, Aug 3: This weekend an estimated 500,000 non-J&K workers, tourists, Amarnath pilgrims and students are leaving Kashmir after the state government advised tourists and pilgrims to leave the valley immediately.
Even as the exodus is on, the majority of non-J&K construction workers seem to have decided to stay put. But the economic implications of the other exodus are grave for Kashmir.
With the mass tourist exodus, Kashmir’s struggling tourist industry has swung into a crisis. Construction activities will be impacted even as a small percentage will leave. Several hundred people in Anantnag and Ganderbal districts who assist in the logistics of the Amarnath pilgrimage will see a leaner income this year. But the real crisis is that of the tourism industry.
Interestingly, as all this unfolds, J&K government says its plan of holding “J&K Investor Summit 2019” on October 12-14 in Srinagar and Jammu stands. The objective of this summit for the government seems to attract investors from other parts of the country and the world to J&K. But considering the current situation, it is unlikely for any potential investors from within the country or outside to attend this event.
What will be the economic impact of this situation on Kashmir?
It is for the first time in Kashmir’s 30-year-long unrest that tourists and pilgrims to Amarnath cave have been publicly asked by the government to leave.
While income from tourism constitutes about 4 per cent of Jammu & Kashmir Gross State Domestic Product (GSDP), it has an important economic and social trickle down effect. It is one of the key drivers of private investment in hotels, catering and transportation is the tourism industry. At the moment, roughly 60,000 men and women are employed in the tourism sector in Kashmir province alone. The latest advisory is feared to impact tourist arrivals in Jammu and Ladakh as well.
Ziraat Times engaged with the key actors of the tourism industry to understand the extent and nature of the impact. Specifically, it looked at three issues:
1. Potential impact on the jobs of employees in Kashmir’s hotel and catering industry.
2. Impact on profitability and loan repayment ability of those businessmen who have made significant investments in the sector lately.
3. The feasibility of the planned J&K Investor Summit planned to be held on October 12-14 in the state.
Convener, Environmental Policy Group (EPG)
The Government Advisory asking tourists and visitors on Holy Amarnath pilgrimage to leave the valley immediately is spine chilling. It will prove a proverbial last nail in the coffin of the tourism sector.
The advisory has been issued by the Government when thousands of Yatris were at different stages of the journey. The Government claim that it feared a terrorist attack on Yatris is hardly convincing because it is being organized in a well-planned manner with the help of more than one lakh security personnel.
I can foresee disastrous consequences both for hospitality as well as the catering sector. Same will be the fate of tour & travel segment. And, since, transport, handicrafts, wholesale & retail, Shikara Walas, pony wallas, daily wagers, salesmen and others are directly connected with tourism, all these sectors will be hit hard. It is significant to note that as per SAMTEK Report jointly formulated by Ministry Of tourism Government of India & Government Of Jammu & Kashmir, the tourism industry employs more than 5 lac skilled, non-skilled and trained personnel in the State. Under the prevailing circumstances when tourism is destined to experience a “bust”, it is unlikely that this huge human resource will continue to have job security for long.
The decision to call off Yatra has tarnished the image and reputation of Kashmiris as being a secular and tolerant society that has discovered, managed and facilitated this very popular and sentimentally important pilgrimage for Hindus. The Advisory has also hugely damaged the reputation of Kashmir as a peaceful tourist destination. The Advisory also contradicts Government of India’s own claims of having significantly controlled the militancy in the State.
The most shocking is the Advisory asking tourists to leave the valley immediately. The huddling and evacuation of tourists from hotels, houseboats, resorts, guest houses finds no precedence. The valley has rarely experienced an unpleasant act or incident targeting tourists.
It is worthwhile to mention that the tourist arrival had started picking up from the second week of June and coming months showed encouraging inquiries and bookings after a near washout of tourist footfall post-Pulwama incident.
It is not only the case of 5 lakh employees but 5 lakh families who, by this unprecedented action, shall have to bear the brunt. Secondly, it is a known fact that the Hotel Industry has been suffering financial huge losses over the years and most of the owners/promoters have sold their other valuable assets for repayment of their loans. The moratorium on repayment post-2014- floods are also coming to an end which will break the back of those entrepreneurs who have made huge investments in hospitality and allied sectors.
The idea of holding an Investment Summit in Kashmir in the month of October under the prevailing environment of uncertainty, security issues, ghostly coming events, contradictory orders, a distrustful and fearful society, bleeding business community, unfavorable weather forecast and many unexplained factors makes the time most inappropriate for holding such an event. On the one hand, the Government is scaring away tourists and pilgrims on security reasons while on the other hand, it is inviting people to invest in Kashmir showcasing it to be a peaceful, productive and investor-friendly destination.
The national and international media is already highlighting the Government’s security concerns and possibilities of serious terror incidents. It owes an explanation to people, tourists, pilgrims and future investors what the real position in Kashmir is. Presently, its actions contradict its own claims. Let the truth come out.
Chairman, Nigeen Tourist Traders Association (NTTA)
The rumors, negative propaganda and apathy had severely impacted bookings and influx of tourists during the arrival of the tourist season this year.
Now that when the hoteliers and businessmen depending on tourism were coping with it after the parliamentary elections marked by sporadic bursts of violence that send tourists rushing home, this new advisory will have major repercussions on the tourism industry.
The advisory will definitely have a negative impact on the livelihood of the hundreds and thousands of families with many hotels closing down, staff being laid off and players in the industry looking for alternative businesses or even job opportunities. In fact, Houseboat owners, once the star beneficiaries of the annual tourist boom, are today woefully down on their luck. Apart from the financial ramifications, it certainly will have a psychological impact as well.
The administration needs to devise a comprehensive strategy when it comes to talking about bringing outside investment. We need to first end the atmosphere of fear and uncertainty, and work unanimously for bringing positive change.
Convenor, Jammu Kashmir Socio-Economic Coordination Committee (JKSECC)
There is a clear cut advisory asking tourists and Yatris to curtail their stay and leave Kashmir immediately. Although some advisories also came to the public domain even earlier the governor immediately came out with clarification and claimed them to be the rumors.
The latest advisory being first of its nature since the ’90s, is beyond understanding and unexpected as Governor himself had been campaigning for the promotion of Tourism, now the trend had completely reversed by issuing advisory which is totally uncalled for and against the spirit of Tourism.
Never before, this has happened, being amply clear even during hard times tourist or pilgrims have always n all long been much safe and secure and people have always welcomed them with open heart and arms.
Ashfaq Siddiq Dug
President, Travel Agents Association of Kashmir (TAAK)
1. The Recent Govt order is a brazen onslaught on the Tourism industry of KASHMIR and this order will act as a final nail in its coffin. The job security of not only the staff working in the Tourism industry, be it hotel staff, catering staff, Travel agency staff, etc will be directly impacted but people of allied sectors associated with the tourism industry as well will be in dire straits. Hospitality sector has been going through rough patch since so many years but post Pulwama things had gone much worse , considering the present exodus of tourists from the valley due to this recent Govt order , Tourism units can’t manage the huge running costs as majority of these units will be forced to lay off their staff but also close down due to the financial constraints of facing zero occupancy in their units . The impact of this order has not only effected this remaining year’s Tourism chances but as well of the next year.
2. Profitability is a forgone thing now, be it the present or future scenario. These tourism units would be facing zero occupancies hence where does the question of profitability arise. We are now in a catch 22 situation where our basic survival is under threat. Majority among us are those who have invested heavily and have huge liabilities of banks. God forbid, once the repayment schedule is effected which, unfortunately, is bound to happen in the majority of cases, one can only imagine the predicament of borrowers and the scene of recovery by these Banks is bound to give sleepless nights to tourism stakeholders.
3. Frankly speaking, the Govt has lost the plot. On one hand, they are issuing the orders to tourists and Yatris to vacate Kashmir on war footing basis and on the other hand are asking the tourism stakeholders to provide the rooms for the so-called Investor’s Summit on a concessional basis. Tell me, under these circumstances who will come and invest in a place like ours where chaos seems the order of the day.
To sum it up, I strongly believe, we tourism stakeholders should think for other alternatives other than tourism. The reason I say so is that tourism has been an eyesore for many and suffering of these sector serves the purpose of many vested interests.
Jr. Vice President, Kashmir Hotel and Restaurant Association (KHARA)
The advisory issued by the Government citing security reasons, I fear, is the last nail in the coffin of the tourism industry. Before this, the decision of the State Government to disallowed civilian traffic on the national highway from 10.00 a.m to 3.00 p.m was also “unjust and uncalled” for. Now, this decision has only added to the problems and woes of the common people and created chaos and confusion as was seen since yesterday afternoon.
I feel that this decision will spell doom for the tourism industry, which is already suffering and the efforts put in by the stakeholders for the revival of tourism will all go waste. It is pertinent to mention here that in March this year another order calling for the closure of Srinagar and Awantipora airports resulted in a major setback to the tourism industry, resulting in mass cancellations of bookings.
Also, the decision of the State Government to disallow civilian traffic on the national highway for two days (Sunday and Wednesday) in a week, during the parliamentary elections, had also proved to be disastrous.
1. The airport right now is like a fish market, overloaded with travelers. Reports of bookings being canceled in hotels are coming from all sides. In such a scenario, the jobs security in hotels will definitely be affected. After this chaos and confusion are over, we as an association will put our heads together along with other tourism players and see a way out. We will see what best can be done to minimize layoffs and ensure their survival with honor and dignity in the best possible manner under the circumstances.
2. It will definitely have an impact on loan repayment ability and profitability also. We will have to assess the quantum of losses and put it up to the authorities for intervention.
3. That is a cruel joke. On one side tourists are being asked to leave forcefully and immediately and on the other side they are inviting corporate honchos to come here for a summit, that too an investment summit.
Chairman, Jammu & Kashmir Tourism Alliance (JKTA)
There will be cut off in jobs naturally with such advisories. Even we had communications from Director Tourism Department, Kashmir to take the advisories seriously and evacuate the tourists.
The promotional efforts that we have been doing so far, they all have been washed off with a single advisory.
This will have a huge implication to the industry people who have borrowings and done some new investments. We will get to see its impact for years now. So far, the Government has been blaming separatists for the panicky situation and now they are doing it themselves.
(This is a developing story and will be updated as and when the situation demands)