Kashmir business leaders meet PM Modi; submit memoranda

Srinagar, April 5: A delegation of top business leaders from Kashmir met Prime Minister Narendra Modi today on 5 April, 2022 at New Delhi and submitted detailed memoranda regarding economic upliftment in Jammu & Kashmir.

The delegation, which included Mushtaq Ahmad Chaya, Chairman, Hoteliers Club and patron of PHDCCI J&K chapter; Sheikh Ashiq Ahmad, President, Kashmir Chamber of Commerce & Industry (Inc); Chowdhary  Mohammad Showkat, President, J&K Hotel & Restaurant Association, Baldev Singh Rana, Chairman, PHD, Kashmir Chapter and few other business persons and highlighted the  urgent issues of  business community of Jammu & Kashmir, highlighted pressing economic issues confronting Kashmir and their suggested remedies, according to a statement issued to Ziraat Times.

The meeting  was coordinated by Dr. Darakshan Andrabi, Chairperson, WAKF Board, J&K.

Besides issues related to settlement of bad accounts impacted by the long years of turmoil, the participants also raised issues related to land lease in Gulmarg and Pahalgam and direct air connectivity to Jeddah/Dubai.

KCCI Sheikh Ashiq Ahmad, President, KCC&I  gave  an overview of the state of J&K’s economy, various issues and presented detailed memorandum on behalf of KCCI to the Prime Minister. PHD Chamber of Commerce and Industry, J&K chapter also submitted a proposal to the prime minister.

According to the sources who attended the meeting, the Prime Minister assured that  due attention shall be given  to the demands made by the  delegation.

Ziraat Times here reproduces the memorandum submitted by KCCI:

MEMORANDUM PRESENTED TO

SHRI NARENDRA MODI

HON’BLE PRIME MINISTER OF  INDIA

The Kashmir Chamber of Commerce & Industry  would like to invite  your kind attention  towards the following urgent issues:

1. AIR CONNECTIVITY:

• Direct  Flight from  Srinagar  International  Airport to Jeddah for  Umrah  and Hajj Pilgrims of the  Union Territory  of  Jammu & Kashmir.

 We would like to  draw your kind attention that the  number of Umrah  pilgrims to Saudi Arabia  from  J&K is increasing day  by  day. The  Umrah Groups are conducted  by  various  tour  operators  who arrange their travel through various Airlines. These airlines operate via Delhi which is reported, does not suit the pilgrims because it adds to the travelling time and also becomes more often inconvenient for them to change the aircraft. The pilgrims would however feel it more convenient to fly from Srinagar to Jeddah directly.

• Direct Flight  from  Srinagar  International Airport  to  Sharjah/ Dubai.

As we appreciate the step for  operating  direct  flights  from Srinagar  International Airport  to  Sharjah/ Dubai. But  the   last  week the  service was stopped. We request your  goodself to kindly  look into the matter  and  restore this  flight at least once a week. We feel that Sharjah/Dubai is an important hub  for  business sector  from  J&K .

1. BANKING & FINANCE:-

• The overall losses incurred over the years have resulted in an unprecedented level of stress on the working capital and finances of the local business establishments. Though there have been several interventions by the Government for extending support but the continuous cycle of disruptions has failed their objectives.

• For accounts which are NPA post 2014 and need revival package, it is suggested that deep re-structuring which converts their principle liability into a term loan with waiver in the unapplied interest similar capital infusion upto 20% with moratorium of 2 years. A fairly extended repayment schedule of about 07-10 years be made applicable to them.
• Soft Loan should be given  for 5 years for all business sector for revival and rehabilitation.
• In the case of One Time Settlements (OTS), a standardized OTS Policy needs to be framed in view of the situation on the ground instead of focusing on the amount of collateral security provided by the borrower. It is suggested that 70% of the amount outstanding on the date of being declared NPA should be the final OTS amount out of which 30% should be borne by the Government with a substantial payback period in line with RBI guidelines.
• Incase of OTS which was announced by J&K Bank for 15  to  5 crore which was widely appreciated by KCCI and all other business organisations with the result bank got more than 50 crores and we have requested that the offer should be given from 5 crore to 30 crores MSME so that the account holders can settle the amount and revive businesses.
• In the case of self-financed business establishments having no bank exposure, It is suggested a suitable capital infusion for such establishments on softer interest rates be made available.

GST reimbursement for the amount paid by the MSME sector is delayed inordinately and needs to be released in the time bound manner as committed by the government. GST penalties for the period of Covid -19  should be waived off so that  they can work properly and engage more people for work.

1. HANDICRAFTS:

• Shri Piyesh Goyal, Hon’ble Minister for Textiles, Industries & Commerce on his visit to Srinagar on 18th of October, 2021   announced setting up of Carpet Village as a demonstration centre of the local craft to visiting tourists and also promote the local Carpet Industry globally. We request your goodself to direct  the  concerned officials for immediate  implementation of  this announcement. This  Carpet Village should be installed with all Common Facility Centers wherein Design Development, Dying, Washing, Bank Facilities, Packing. To promote this Carpet Village wherein Carpet Manufacturers/ Exporters will come out with the new innovations and designs to cater the International Market.
• Exporters are facing lot of challenges and difficulties as regard to exports from Kashmir region is concerned. As we are at the fag end of India without logistic support as still we have no dry port with the result export goods reach Delhi with higher fare rates resulting losing the competition at international level. So freight subsidies be given to exporters  from  Jammu & Kashmir as they can’t compete.

With others who are close to ports. Kashmir has a geographical disadvantage in logistics in respect of road transport. In order to increase export and make our products competitive in the international market, there is need to subsidize freight both air and road.

• State  and Centre Government must  come  up  with the  attractive schemes  so  that  our  entrepreneurs / new educated / unemployed youth will attract towards  this Export Industry.
• All handmade items should be exempted from taxes like GST. To preserve the livelihood of Weavers, Artisans, Traders, and Exporters who are involved in handmade Handicraft and also the famous art of Cottage Industry, the GST must be waived off on Pashmina Shawls, Carpets, Papier Machie, Crewel, Chain Stitch and Wood Carving.

• Those Silk Carpets which contains more than 60% silk should be given 7% incentives in RODTEP Scheme to encourage and boost Silk Handmade Carpets in Kashmir.
• There should be a separate ITC (HS) code for Pashmina Shawls and verified by the competent testing laboratory.  No capping should be placed on Pashmina Shawls or other value added handicraft items under RODTEP Scheme.
• Government should give all the benefits to Kashmir Handicrafts and declare it as Special Economic Zone.
• Warehousing Facility at International Airport.
• The Department connected with the Exporters such as Banks, ECGC, DGFT need to provide the required awareness to the exporters.
• Government must give support to the present manufacturer / exporter to sustain in this present turmoil as most of the accounts are either stressed or turned NPA’s.
• Due to slow down in the Global Market since 2014 J&K Government should take up this matter vigorously with the Reserve Bank of India so that our Exporters and Manufacturers are relieved as their exports collection are very slow. They should be allowed either to get back their goods so that lot of complains are taken care of.
• Office of the Jt. Director (DGFT):- Till few years back the office at Srinagar was being manned and managed by Joint Director (DGFT) and our problems and needs were being well attended thereby solving the said problems expeditiously. Unfortunately now the office is being held by a junior officer which results in undue delay in solving of the problems. It is requested that a Joint Director General be posted at Srinagar permanently.
• The Kashmir Chamber of Commerce and Industry has felt the need of having Expo Marts for Handicrafts products   and Carpets were we can Exhibit our products to International Buyers.
• Inland Container Depo in   Kashmir will be created which will help our exporters to export directly from Srinagar and increase the products which we are exporting not only but also the volume of present export.
• The Handicraft  sector of Kashmir could receive  a huge boost if the Central Government would reserve a minor percentage of  Central Government  purchases  as well as  urge other  State Governments  through out the Country for purchases of  Kashmiri Handicrafts  products including Shawls and Silk Handmade Carpets,  office furniture and interiors ,  stationery, etc. there is a  little hope   for this traditional sector of ours  than the  Government adopting Brand Kashmir.

This would also greatly  support the liquidation of  huge pile up  of inventory  in this sector for which the KCC&I has also pushed  for special funding  to the tune of 500 Crores.

1. TOURISM SECTOR:-

TRAVEL AGENTS /TOUR OPERATORS:-

• Interest Free /Soft Loans for survival & revival of Tourism Industry and waiver off on CC accounts/ consumer loans.
• Tour operators to be considered as units as defined under the MSME Schemes.  
• Three-year full GST Waiver.
• A substantial amount of capital of this sector has been  blocked with various Airlines on account of booking  prior August , 2019 so far all efforts  for refunding of  the amount  deposited with the airlines have  proven futile. We seek your kind intervention in resolving this critical issue.

HOTELS /GUEST HOUSES/ RESTAURANTS/ CAFES :-

• The Government has been kind enough to engage a number of local Hotels in Srinagar for Covid-19 operations since March, 2020. It needs to be appreciated that in March, 2020 most of the local hotels were closed down or operating at minimum levels. Due to the engagement by the District Disaster Management Authority, substantial capital was invested in making the Hotels operational, re-engagement of employees and other expenses were incurred. It is surprising that since March, 2020 the DDMA has so far neither finalised the rates nor has any payment been reportedly released to our Hoteliers despite months having passed. The KCC&I has raised the issue several times but no tangible response has so far been given by the Government.
• Land lease  needs to  be extended at Pahalgam and Gulmarg as the owners  have suffered huge  losses due to  unavoidable circumstances.
• Three-year full GST Waiver.
• This sector is facing huge expenditure on account of taxes and fee being charged at higher Commercial rates as in Water Charges, Interest in loans, Sanitation Fee, Electricity Charges Licence Fee, Rent, staff salary. In the absence of any business especially in the Tourism sector it is suggested that all the taxes and rates payable to the government may be  waived off, reduced or deferred as  the Committee may deem appropriate.

TOURIST TAXI OPERATORS:-

• Bank Loan upto Rs. 3.00 lacs be waived off.
• Special Package(Cash / Financial grant/ Relief package) for revival of tourist taxi operators.
• Enhancement of  validity of registration /life of taxis from 20 years to 25 years.
• Hiring / entanglement of local transport services for official and Departmental use.   
• Creation of designated taxi stands at important health installations like hospitals  and nursing homes.

HOUSEBOAT / SHIKARAS:-

• This sector is facing huge expenditure on account of taxes and rates being charged at higher Commercial tariffs as in Water Charges, Interest in loans,  Electricity Charges, staff salary. In the absence of any business  especially in the Tourism   sector it is suggested that all the taxes and rates payable to the government may be  waived off , reduced or deferred as  the Committee may deem appropriate.
• From last  few years  many  Houseboats were gutted in fire incidents we request your goodself to  give full support, rehabilitation and  subsidized timer for  the new  Construction of Houseboats so that this heritage  Industry  can also survive. 
• Due to heavy financial losses the houseboat owners have not been able to repair their houseboats especially of its bottom portion which need repairing from time to time and involves huge amount to keep it floating and due to their inability to do it a number of houseboats have already sunk. Financial support in this regard may be extended in cases where required and also supply of Timber through a special quota from the Forest Department is needed.  
• Waiver of electricity charges.
• Appropriate rehabilitation scheme for house boat owners willing to surrender their licenses. 

1. INDUSTRIES SECTOR:-

• The local industrial sector is undergoing a very difficult period due to a combination of circumstances and change in Government policies. The lack of budgetary assistance and abolition of Toll Tax without formulation of any substituting protective mechanism has severely impacted the local industries. The disparities in disbursal of reimbursement vide SRO’s 63, 519 and 521 have also resulted in creating unfair disadvantages for many local units. Incentives tend to be more in favour of new units whereas the KCC&I has urged that incentives and reimbursements need to be uniform to ensure a level playing field. Measures like providing of Working Capital at concessional interest rates, waiver of interest for the period of lockdown, reschedulement of repayment plans, lowering of power tariff and waiver/reduction of fixed demand charges, reduction of rental charges payable to SICOP/SIDCO are urgently required to provide sustenance to the local industries. 
• Local industries supplying to the Government have reportedly a substantial amount of their capital locked up due to inordinate delays in the release of their payments. The KCC&I requests that the mechanism be devised for automatic time bound release of payments by the Government. 
• Electricity demand and surcharges waive off.
• Rental bills of industries employee salary share operational cost from post August.
• Price preference for local on Government purchases.
• New Industrial policy benefits  be  extended for existing Industry like Interest Subsidy on Working Capital and Term Loans.
• Link Up of local industries with Defence supplies.
• Government equity in local business.

GENERAL TRADE:-

•  Due to the thirteen months of a continuous lockdown and for reasons elaborated upon by us in our earlier communications the current situation of our business community is critical and there the need for amending of various guidelines and deadlines with regard to filing of taxation returns and submission of taxes.
  •  The situation is such which may not have been envisaged in the general guidelines of the GST policy, Company Affairs, CBDT and the RBI. As a result there is an imminent build-up of penalties along with interest chargeable on the dealers who have, in many cases, lost their capacity to even pay the principal tax amounts. This is a cause of concern for all of us and there is huge stress on the business community.
  •  Even in the situation emerging after August, 2019, The Kashmir Chamber of Commerce and Industry has throughout made all efforts to ensure compliance by our dealers through public awareness messages and support the Government in collection of various taxes. There has been close coordination with the Department of Finance during this period.

AGRICULTURTE  / HORTICULTURE SECTOR:- 

• The KCC&I has been urging the Government for following the model of Himachal Pradesh where the Horticulture Sector has benefited tremendously from the aid of Rs 1,134 Crores provided by World Bank to the HP Horticulture Development Project. Apart from this, the HP State Government has introduced various schemes like Pushp Kranti Yojna, Mukhya Mantri Madhu Vikas Yogana, Mukhya  Mantri Green House Scheme and installation of anti-hail nets to boost their Horticulture Sector. Besides the above, the Asian Development Bank aided projects amounting to Rs 1,688 and Rs 423 Crores have also been  approved for development of subtropical fruits and mushroom. For farmers, the m-kisan programme has also been launched for solving the day-to-day farming problems. 

Our Horticulture Sector has a much bigger potential which needs to be developed for local stakeholders by investments and interventions on the pattern of Himachal Pradesh.

• In addition to the interventions sought in this sector elaborated in the Key Points above, the Government of Jammu and Kashmir has laid lot of emphasis on the development of Horticulture Sector. Accordingly lot of  Agripreneurs have shown interest to enter this emerging sector  and have undertaken market research to  establish  the current demands  of  new root stocks at  farm level.  The farmers have shown tremendous interest in the new Apple varieties based on M9 Root Stock. The following problems have been identified which are acting  as an impediment  for the  growth  in the sector:-

• The interest rate  charged on our advance by the financial institutions (J&K Bank Ltd) is  exorbitantly high which  at present almost 13%. It may not be out of place to mention here that the Reserve Bank of India has declared vide their notification No: RBI/2014-15/573 dated 23, 2015 that our industry  falls  in  priority sector (Agriculture) lending which  attracts  rate of interest  little more than the  declared Marginal  Concessional  Lending  Rate  (MCLR) which at present is 9%. We have been repeatedly requested the J&K Bank to reduce the rate of interest  retrospectively  as this high rate of interest has become  detrimental for the sustainability of this industry.
• To flourish and give boost to the Horticulture Sector we have been continuously   requested that the government should set up Horticulture parks on the pattern of  (at present) the industrial estates growth centres.
• Many of our members have already started new enterprise for the development of pre and post Harvest  Horticulture Sector. However few of the following suggestions if accepted  by the government shall boost the private investment in this sector which are:-

• The infrastructure of Post Quarantine available with the government should be extended to the intending private Agripreneurs so that the biggest impediment  of PQE is  taken care of  and then  we can say  with certainty  that this sector  shall be the largest contributor for  doubling  of  farmers  income by 2020.
• The toll tax and GST  on import of all  Agriculture  based equipment like, Plant & Machinery of CA Store, Trellis  System, gable  wire and all accessories  required to  establish  high density  apple orchards based on  M9 root stock, should be exempted  as  all these activities  fall under  the  Agriculture Sector.  The services  provided  by the Cold Storages are  already  exempted  in GST regime  as such  the Plant &Machinery  used   for the establishment of new Cold Storages   should  also be exempted  from  any  tax. 
• Transportation of Horticulture produce  to  various Mandis across the Country has been  considerable hit  by  frequent road blocks and one way traffic it is strongly suggested that   the fruit  laden tracks  should not be stooped  on any day.

 FLORICULTURE:-

• This is nascent industry in Kashmir which can be developed to International level provided infrastructure is provided   and created.

The Kashmir Chamber of Commerce & Industry  long back gave a proposal to APEDA which was supported by the then  Government to create Flower Centre on the pattern of Dubai Flower Centre.

Follow up :-  The representative  of the Kashmir Chamber of Commerce & Industry  had  a meeting  with the Secretary  Floriculture  and suggested  the following:-

Extending  50% subsidy  by Integrated  various  subsidies already available   in this sector from  Govt. of India and  further  proposed  support  to be created  by the State  Government   for at least 10 projects of   the size of 10 crore rupees  each with maximum subsidy of 5 Crores. 

EDUCATION SECTOR:-

• One Time registration.
• There should be an Education cluster for Professional College and Degree College like industry so that the stake holders get land on subsidized rates.
• After implementation of the New Education Policy from the Center the state wise state Education Policy committee is constituted we request that Stakeholders from the education sector should be the members in the said State Education Policy Committee.
• A Special Education Program for Elementary School Teaches has been demanded by the local stakeholders in view of Elementary School being the foundation of schooling. 

YOUNG ENTREPRENEURS:-

• CGTMSME scheme is not on ground and the scheme is not followed by any Financial Institution 
• There is a Scheme that up to Rs. 25 Lakh no mortgage is required but Bank has not followed that they are still asking for mortgage. Financial package announced by the government there is MSME scheme that upto Rs. 1Crore no mortgage is required but this scheme is also not followed by the financial institution.  
• Rs. 300 Crore fund is with Development Financial Corporation (DFC) but the negative response of the department no one avail that funds.
• The schemes of  Khadi Village Industrial Board (KVIB) is only  for rural areas. It should be also for urban area. The slab of the schemes is 25 lakh it should be raised up to Rs1 crore. 
• There are so many formalities so we request for single window clearance. 
• Most of the young entrepreneurs want to do retail, service, online business for that we request Government that the shopping malls Like SDA Auqaf Markets or any other market places should be given to youth on priority on rental basis.