Damaging the tourism industry
The concerns of the tourism trade have finally got an approval by a parliamentary panel which has spelled that the GST and the negative public campaign unleashed by various quarters against the region is killing tourism trade in Kashmir.
Tourism trade in Kashmir has been on the receiving end. Not only have the tourist footfall decreased tremendously over the past three years but the government’s attitude in helping out the trade and the people associated with it, too has been pathetic.
It is beyond any doubt that the Goods and Services Tax (GST) regime has had a negative impact on the economy of entire Jammu and Kashmir. The effect of this new tax regime have been far more harsh on tourism industry as the new tax regime has left a deep impact on the sourcing of products and materials in the state.
Unlike other states, residents of Jammu and Kashmir and its business owners spend huge amounts of money on procuring essentials, most of which have to be flown in, which increases their capital expenditure.
While the GST regime was set into motion no consideration was given to the sensitive nature of Jammu and Kashmir state. The abrupt implementation of GST on tourism in the region resulted in manifold effects, mostly negative on the overall economy of the state and the tourism trade in particular.
The GST impact was so harsh on tourism trade that small business owners of small-scale hotels and home stays cannot list their properties on various travel intermediary websites as there is a levy of 18 per cent of GST, which cuts across the little profit they make, making their venture unsustainable.
The GST implementation in Jammu and Kashmir should have been done in a cautious and phased manner in order to ensure that the delicate state of tourism in the region is not adversely affected. Worse, the federal government or the state government did not even bother to take on board the stake holders or their concerns when a draft policy was being formed on the GST.
Now that the issue has been raised by a parliamentary panel, the federal as well as the state government should take a call on this report and help to come out with some policy to avert any fresh loss to the tourism industry in Jammu and Kashmir.
The parliamentary committee also expressed worry over the negative publicity which it cited as a major hindrance to increasing footfall in the region. This issue has time and again been raised by the elected government and even various trade bodies during the past two years.
Even the incumbent Governor, Satya Pal Malik has been raising this issue that Jammu and Kashmir is being demonized and the TV channels and some section of the media is actively involved in such an exercise.
The panel recommendations that have come to the fore need to be taken up earnestly and the checks and balances mechanism needs to be implemented so that future damage to the state’s economy can be stopped well in time.