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‘The World Around Us Will Change In These Two Years’

Before joining as Jammu and Kashmir’s Principal Secretary for Industries and Commerce, senior IRTS officer, Ranjan Prakash Thakur has held many key positions. Born in London, he studied at the St Stephens College, IIFT and IIM and joined the Railways in 1990. He has many feats assigned to his name in the railway sector including the introduction of e-ticketing services and the upcoming glass top coaches for the Kashmir train. While serving Tourism and Information and Broadcasting ministries, he has handled particular projects in Jammu and Kashmir. Now he will oversee the implementation of Rs 28000 crore industrial package in Jammu and Kashmir. In a freewheeling interview with Masood Hussain, he listed his priorities and shared his vision:

Rajan Prakash Thakur, IRTS, is the Principal Secretary of Industry and Commerce, Jammu and Kashmir

KASHMIR LIFE (KL): When you landed in Jammu and Kashmir and got the welcome briefing, you obviously did your own SWOT analysis. So which are the key weaknesses and strengths of Jammu and Kashmir?

RANJAN PRAKASH THAKUR (RPT): Let me say very clearly. It is always good to be transparent about certain things. As you know, Jammu and Kashmir does not have a free, (rather a) closed economy. It’s a hill state, a border state with other concerns. There has been the revocation (of Article 370) and then the Covid-19. Being a railwayman, I can say that because of the poor connectivity, the industries are dependent on government support. I would not judge whether it is good or bad, but in the long term, I could say, remaining dependent on the government becomes a liability. We will have to be market-oriented rather than subsidy oriented. Government can help in getting you to stand up but cannot support you forever. Eventually, the industry has to survive on its own. So, the initial help given by the government is for the industries specifically to get them launched and help them move forward and eventually learn how to stand on their own.

The change that was brought about two years back in August envisages a lot many changes in it. We would like to see Jammu and Kashmir, a self-reliant place that stands on its own strengths without any subsidy. Knowing that there have been problems here before, this initial support to kick-start the industry is required so that Jammu and Kashmir rediscover its strengths.

As for the SWOT analysis, I only saw the strengths, not the weaknesses; however, one weakness that is identifiable is that the people have suffered a lot for many reasons, I wish not to get into. Now, we are investing Rs 30,000 crore in Jammu and Kashmir to kick start the process. It is sort of an initial help after which, the industry will be expected to stand on its own. It has already happened in Himachal Pradesh and Uttarakhand, they were given subsidies and initial support, and now they do not need much help now. This is what I expect from Kashmir in the next 10-12 years. We will provide subsidies, incentives and allotments and bring transparency and then the industries will start and grow on their own towards self-sustenance.

In two years time, there will be a railway line connecting Kashmir and things will start to flow into the valley at cheaper rates. This can even have an impact on certain things that are being manufactured locally. But see from the other side – Kashmir will get access to the rest of the country. There will be many opportunities ahead. Every cloud has a silver lining. Every threat is an opportunity and every opportunity is a threat. We are trying to encourage Kashmir in the next couple of years so that it competes on its own. We hope that the people of Kashmir as well as outsiders will invest in Kashmir and make it a home base. There remains some capital problem but once companies from outside and multinationals with huge capital will join us, things will be better. With an open heart, we want to get the industry because this will get us wide-scale employment for the local population. This will get us jobs for the skilled youth of Jammu and Kashmir. Jammu is the only city in India that has an AIIMS, an IIM and an IIT. The boys and girls from Kashmir are working across India. They can come home.

KL: The last major industrial package that Jammu and Kashmir got was in the Vajpayee era. The current industrial package of Rs 28000 crore plus is also being seen very positively. But what is the net difference between the two?

RPT: Vajpayee Ji has been our respected Prime Minister. He has done a lot for Kashmir. But the current package that our Prime Minister has given has never been given to any state before. No state has ever seen this much liberal funding from the centre, ever. Perhaps no other state can ever have this kind of package.

Our Return on Investment on fixed corporate investment is currently more than double of any other state right now. If you will invest Rs 100 crore, you will be able to take Rs 300-400 crores back. This is not the case with every state. In other state’s you will get Rs 150 to Rs 200 crore. So, we are not talking about minor differences. We are actually talking about double benefits.

KL: The last package aimed at managing unemployment witnessed an investment of Rs 3000 croe plus against incentives worth more than Rs 6000 crore. If you visit these units, you will find almost 70 per cent of non-locals working. Is the new package also aimed at managing unemployment or it has production as the key objective?

RPT: If it would have been just about production, places like Punjab and Haryana would have been better because that is in Gangetic plains and you did not require venturing into the mountains. Wherever this much money would be invested, the place would see the industry coming up. Entire India needs to be developed but we have to carry everybody along. Had it been development or production, it could have been done anywhere.

Let me tell you the other thing as well.

The incentives are production-linked incentives, not being given to have roofs for your factories or to make homes. Eighty per cent of it is in GST form that means once you will pay GST you will get it. And GST is only paid when there is production. The incentive scheme is not for those who will superficially set up the industry but for those who will actually produce. The package has been structured in a way that it would not be misused, as has happened in many states in the past. You will work with the bank and once you pay, you will get the interest subvention.

For any investment in industry, the key objectives are that the people must have work and they must be able to feed themselves. We are not getting everybody here and we have scrutiny on our agenda because we have the focus on the employability of local youth.

We are setting up an IT tower, one each in Jammu and Srinagar, at a cost of Rs 50 crore each. The Valley youth works outside in other states like Bangalore, Pune, and Chennai. If those companies are incentivised and given free space here, the youth will be able to work here. We have all youth from Jammu and Kashmir working in the Earnest and Young and PWC teams. The team leader is from outside but the boys and girls are local.

The industry you are referring to is the industry in which manual labour is required.  That comes from our states like UP and Bihar, it doesn’t come from Kashmir because Kashmiris don’t do manual labour, and they have a different level (skill set). Jammu and Kashmir both need two different sets of services. They will do what suits them.

In Kashmir, manual labour is needed but the cost of manual labour is very high which is why it is difficult to get it. You have a different skill set so we should have IT, services, hotels and BPO.

The youth does not want to work as manual labourers, which is why we are trying to address the issue and making sure that everything should be in terms of the desirability of the creation of empowerment, which is a big target for me.

This package is production linked, but the primary target is employment generation. We have to get the people to the mainstream. I want to tell the people of Kashmir that their bright future is with growing India and that you are a part of it and you will get a lot of opportunity in it. Jammu and Kashmir is a special state, a border state that has a history and this is time to reap the benefits.

An aerial view of Royal Golf Course, Srinagar.
An aerial view of Royal Golf Course, Srinagar.

KL: The global focus is on environmentally sustainable growth (ESG) and across India, barring a few hill spots, Jammu and Kashmir is the only place that suits a low-carbon footprint growth. Is the industrial policy about concretization and steel or there is some ESG element as well?

RPT: In our package, service has a big component. For Kashmir, the services sector is the focus because that is your USP – tourism, IT parks, hospitals, nursing homes. The package is not just about production, it has a lot of services element includes heritage restoration, film shooting equipment, hospitals, gyms, nursing homes. We want the pharmacist schools and nursing schools to come up. We want to promote them all. Services suit the nature of Kashmir. Hill states have a very fragile ecology, we should preserve it. It is our heritage. The processing sector suits Kashmir so does the wellness industry.

We all have to make this decision, to make and keep this valley as beautiful as it is without disturbing its ecology. Why should you open a cement factory? You get cement from where it is cheaper.

Lal Chowk, the heart of Srinagar on July 13, 2020, when the second phase of lock down started for containing the Covid-19. KL Image: Bilal Bahadur

KL: There have been some serious efforts by ways of interaction despite Covid-19. But what is the response to the call for investment in Jammu and Kashmir?

RPT: The response is overwhelming. Since I do not want any smoke-creating industry here because of fragile ecology, hence, we will filter out people. I don’t want all of them here. I want to be selective. I want those who will give this state ecologically sustainable growth. I am receiving a lot of queries from people because such a package has never been given to any state before. The response is very aggressive and overwhelming. Uttrakhand and Himachal industrial packages have expired and the package that we have is better. So people are coming but I do not want all of them. I want good people with a clean industry that gives us an ESG advantage.

Incentives apart, the power tariff for the industry in Jammu and Kashmir, is the lowest in India. Here a unit is being given at Rs 3.85 and in the rest of the states, it starts from Rs 7.50, a unit. Then the land is being given also very cheap. In Jammu and Kashmir, the issue always has been about law and order. Forget the perception; the fact is that crime is amongst the lowest (in India). This I am saying on basis of the data that I have. So the perception and facts are different.

So what is the requirement? We have given licence to land container depot in Samba and another to Container Corporation for Kathua. We are discussing with Dubai Port to get them to Kashmir. The railway is coming to Kashmir within two years. The issue is that when the rail will come, will you be ready. Your factory should be operational. We will create a dry port and you will have no issues on the exports front. These things were not in Kashmir earlier. We have already got the night landing of the aircraft in Srinagar. This did not happen in the last 40 years and now it is happening in a year. This is the change, the beginning new dawn.

A Kashmir Chamber of Commerce and Industry delegation with BVR Subrahmanyam, Chief Secretary, Government of Jammu and Kashmir on November 11, 2018

KL: In the post-2019 situation, how will you address the local concerns that capitalism will come and inundate Jammu and Kashmir?

RPT: Industry will come only if the investor is able to earn something. No industry will come to ruin its investment. Industries will only come if they are in demand but given the demography, the demand base is narrow in Kashmir. I belong to Bihar where the population is ten times more. Why would big, overwhelming industries come to Kashmir then? It is not possible that you will manufacture here and sell it in Bihar. So there should be no fear that it will be a production base.

Kashmir has its own USP that is unmatched – its valley’s, mountains, freshwater, special fruits, trout fish, who else has all this? If we need rice and wheat we can have them in Bihar and UP. You have USP that sets it apart. Going by the law of combative advantage, you have Saffron, Walnut, almonds, and tourism. This is all yours. People come here solely for that. Why should somebody visit Bihar – to see the rice fields? Production can happen elsewhere. Only those companies can come, which will give you consumption at cheap rates.

Just because the market size is not that big here in Kashmir, we should not fear that. The nature of development will be different for Jammu and for Kashmir. But my objective will always be doing what the people want.

One more important thing is that this package is for everyone, not just the outsiders but the Kashmiris as well. I just want to say that no economic imperialism is starting, it is wrong.

Weaving Dreams: This chromolithograph drawn by Scottish artist, war artist and war correspondent William Simpson who visited Kashmir somewhere between 1859-60.

KL: Handicrafts is our heritage industry. Given the fragile nature of the Jammu and Kashmir market, it is in crisis. What you plan to do?

RPT: We have directions that we have to focus on the handloom traditions of Kashmir and Jammu. You have market issues and you have market-linked issues. There is not much international demand because these are bad times. Many of us are working together to improve the market links. You might have seen a website, Kashmirbox. They are selling certain things but they have to resolve some market issues.

As the Principal Secretary Industry and Commerce, Jammu and Kashmir, Rajan Prakash Thakur, IRTS, will be overseeing the implementation of the Rs 28000 crore industrial package.

Given the Covid-19 crisis, we have been directed to go for market intervention by directly purchasing from the artisan and scaling them up. There are problems at the artisan level and some arts are dying. If working in handicrafts remains non-remunerative, the new generation will opt out of it and then you will never be able to address that issue. We will support them and we are improving their market intervention even if it increases our inventory. We will have to give them a package so that they can purchase materials and it has to be done in such a way that it will not compromise their dignity. We plan to purchase directly from artisans through Jammu and Kashmir Handicraft Development Corporation. Even if we do not require these items, we will still purchase them. Handicrafts are a huge sector and it needs to be preserved. It is the country’s heritage and pride.

KL: A lot of capital is idle in the inventory of the trade. How plan you plan to release that?

RPT: We are getting into a lot of exhibitions so that people purchase and it will reduce the inventory. But the Government can intervene till a particular point, not beyond that. We have started market intervention. Even though the Covid-19 situation lies there, we are sending people out, organizing craft melas. We will have to wait till the pandemic is over. We can intervene to a level, we can invest Rs 50 to Rs 100 crore and then the market has to take over so it will take a bit of time. We are not able to have exhibitions right now but we are aware of the problems and we intend to solve them.

The apple harvest and grading in progress. KL Image

KL: Apple the mainstay of Kashmir’s peripheral economy. What plans do you have?

RPT: The transportation factor is opening up and it will bring about a massive change. Once we can transport the product to Delhi in 24 hours at one-fourth of the cost that you are doing today, it will radically change the market.

If you see history, when the British brought the railway to India, it had a huge economic impact both good and bad. It will have a disruptive impact.

Once that happens, while outside products will flow in cheaply, we can also send our products cheaply. Your market access will improve. Trucks and containers are refrigerated; the apples will survive longer and even reach Chennai in 3-4 days without the high cost. That is not possible today when your highway closes frequently because of landslides.

The market access to agriculture will improve substantially. The world around us will change in these two years. What did not happen in the last many centuries will happen in the next two years.

Kashmir has a problem of being land-lock and has transportation issues and the next two years will see a change.

A view of Burzhoam heritage site. KL Image: Aaqib Hyder

KL: The novel thing in the package is that it links the heritage with industry. What is it all about?

RPT: I am somebody who admires heritage. History is my passion. I have incidentally worked with INTACH for two years after schooling because Patna also has some heritage issues.

We have kept the heritage sector consciously in this package. The restoration of heritage buildings will be done substantially. We will encourage whatever restoration can happen.

We will fund the restoration of the heritage buildings through this package substantially because industry usually comes to places where they have heritage hotels. Neemrana is one great instance where the economic summits happen there. So, convert the heritage into commercial property so that people admire it and enjoy it. We can have meetings in these properties and some of these can be converted into showrooms. Once restored, these will have to be commercially viable. We can look at having hotels, convocation centres, and handicraft showrooms. These heritage properties should be living symbols, not dead museums.

(Syed Samreen processed this interview)

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