Pahalgam terror attack: 10 lakh bookings cancelled, J&K tourism loses over Rs 1,000 crore in 2 weeks

Very few terror attacks in recent memory have impacted Jammu and Kashmir's economic and investment prospects as much as the April 22 shooting rampage. Besides plummeting investor confidence that will lead to reconsideration and delays of plans and projects, ongoing projects will be affected, critically hampering job creation and resulting in an economic slowdown affecting livelihoods and growth prospects.

 

The brutal terror attack on tourists in Pahalgam’s Baisaran valley has taken a big toll on the Union territory’s mainstay tourism sector, which has crossed over Rs 1,000 crore ($120 million) in just two weeks. And, things do not look good either in the near future. Amid the peak April–June tourist season, more than 10 lakh tourist bookings have been cancelled in the days after the attack.

 

Already, the government has closed 48 of the Union territory’s 87 government-authorised tourist resorts as a security precaution. This measure will severely impact the livelihood of the locals in the Anantnag and Baramulla districts, where more than 70 per cent of the population depend directly or indirectly on tourism.

 

Hoteliers and hotel employees, pony owners, shikara operators and handicraft vendors are the most badly impacted. The attack has ushered in an atmosphere of fear that may take a big toll on the investment climate.

 

About Rs 25,000 crore worth of projects are being executed in the valley at the moment after the approval of 1,767 proposals. These include projects under health care, infrastructure and industrial development sectors. A source told THE WEEK: “The J&K government has received over 8,500 applications with investment proposals totalling Rs 1.69 lakh crore. These proposals are expected to generate employment opportunities for over 6 lakh individuals.”

 

On the other hand, ongoing projects in Kashmir are facing uncertainty amidst heightened security concerns. One case in point is the uncertainty faced by the UAE-based Emaar Group’s Rs 500 crore investment in the ‘Mall of Srinagar’ and associated multipurpose towers that are expected to create over 10,000 jobs.

 

Investments expected from interested international companies like noon.com, Al Maya Group, GL Employment, and MATU Investments may be deterred to act on the investment proposals they have submitted to the government and may back out. 

India