Peace Premium May Bring In Investors To Kashmir Valley

Peace Premium May Bring In Investors To Kashmir Valley

28 July 2012
Times of India
Partha Sinha

Mumbai: Return of peace in the Kashmir valley, although under the umbrella of heightened security, has of late been attracting tourists to the region that is often called 'Paradise on Earth' for its unique scenic beauty. With tourists back in the valley, its economy is also looking up. So it is quite natural that soon opportunities to make money would emerge in this northern-most state in India. 'Kashmir - Paradise Regained!!' by IIFL Institutional Equities is probably the first such on-the-ground report by a brokerage house that attempts to spot the potential economic trigger points in a region that, for nearly two decades, was a hot bed of cross-border terrorism. Since end of 2009, a combination of confidence building measures and investments into infrastructure and job creation has meant that peace has returned slowly to the Kashmir valley, wrote Murali Iyer of IIFL, an IndiaInfoline group company. 'This is bringing in tourists into the valley in droves and is having a huge impact on Kashmir's GDP. Our various interactions with people indicate that peace is being given a chance,' Murali wrote in the 12-page report. He spotted quite a few opportunities in the valley during a family vacation there, and believes these can have a positive impact on the Indian economy as a whole. The opportunities as well as growth drivers include infrastructure, for tourism in particular and for the locals in general, and also consumerism. The return of peace in the valley, although still one of the most militarized zones in the world, means the surge in tourist arrivals will continue. Over the last two years, the state's GDP growth has been between 6% and 7%. 'While the direct beneficiary of the GDP multiplier in Kashmir is J&K Bank (the only listed entity head quartered in the valley), there are other aspects of the state that will swing into focus soon,' the report pointed out. 'Foreign tourist arrivals are bound to increase and we hope the halo effect bodes well for 'Incredible India.'