What apparently started with the auctioning of the mineral blocks has now become all-pervasive, with non-local contractors bagging the major contracts in Kashmir due to the advantage of cheap and easily available raw materials, power, and constant working allowance to them.
AFTER braving the situational onslaught, the sudden change of Industrial policy post the abrogation of Article 370 has left many young and promising Kashmiri unit-holders in the lurch.
Many of them had left their lucrative jobs outside and returned to work in their homeland, where the possibility of having a successful stint seems a tough grind now.
According to the junked J&K Industrial Policy 2016, the lowest bidder used to get 1/3rd of the tenders and the rest of the bidders would share equally the 2/3rd of it, thereby providing an opportunity to everyone to work and earn.
The mission statement of Industrial Policy 2016 clearly endorses promotion and development “of the micro, small, medium, large industries for employment generations and higher contribution of the industrial sector to the gross state domestic product (GSDP)”.
The policy which was supposed to remain in operation till 2026, mentioned that the locals would be given the utmost priority for employment and tenders considering the former state’s geographical and economic situation.
Tough Race for Locals
Raising the concerns of local unit-holders, merchant-politician Altaf Bukhari insisted the government to chalk out a comprehensive industrial policy for J&K in consultation with all stakeholders.
The former finance minister of J&K also cautioned New Delhi not to play with careers of lakhs of J&K youth whose livelihoods are dependent on the native industrial units which are facing huge setback due to government’s tendering process.
“The inevitable cost of achieving competitive efficiency which is being projected by the government cannot be applied to J&K unit-holders who are not in a position to compete with their counterparts from the rest of the country,” Bukhari, the J&K Apni Party chief, said.
But as more non-local contractors are coming into the field, it has become difficult for the locals to compete in the race, said Namrata Sharma, Provincial President JKAP Women Wing, Jammu.
“The party has raised the concerns with the Lieutenant Governor Manoj Sinha regarding the delay in payments and the loss of local contractors. However, there is no option but to wait for the result.”
In a recent development, the J&K administration said that it would liquidate the liabilities including interests in the power sector, by raising over Rs 11,000 crore under the Atmanirbhar Bharat Abhiyan to relieve the department of the liabilities and interest accruing from it and infuse new lease of life into its subsidiary companies constituted after disbanding of the power department.
Amid the liquidate move, Raja Nayeem Khan, President Kashmir Electrical Manufacturers Association (KEMA), was forced to write a letter to the managing director of Kashmir Power Distribution Corporation Limited.
The letter requested the official to issue instructions such that “materials should be distributed among all unit-holders on the same rates as quoted by the lowest bidder to save the other unit-holders from closure”.
Notably, the non-local bidders have the advantage of cheap and easily available raw materials, power, and constant working allowance unlike people of J&K, Khan said.
“The local contractors are dependent on government tenders and the rates charged by them are not feasible in another state. This limits our scope only to J&K.”
Farooq Amin, Secretary-General of Kashmir Chamber of Commerce and Industry (KCC&I), told Kashmir Observer that the valley’s apex trade body has repeatedly requested the government to limit the contracts given to non-locals and provide reservation to the locals because they cannot compete with big contractors.
“The terms and conditions like turnover requirement, bidding through Government e-Marketplace (GeM) portal should be eased out for J&K to prevent it from further unemployment,” Amin said.
GeM facilitates online procurement of common use goods and services required by various government departments, organizations and public sector undertakings.
By introducing purchases through the GeM portal in J&K, the government is placing all Small Micro Enterprises in competition against big manufacturers from outside the state.
However, Amin informed that in Ganderbal district, the government has given preference to local contractors.
“This proves that the government is taking cognizance of the issues faced by the local contractors in the valley,” he said.
Mahmood Ahmad Shah, director of J&K Department of Industry and Commerce, told Kashmir Observer that some provisions of Industrial Policy 2016 were undermined which has caused some difficulties to the local unit-holders.
“A committee is formed under the chairmanship of Advisor to Hon’ble Governor, KK Sharma to look into the losses and economic survival,” he said.
A majority of the local associations already attended official meetings and registered their grievances (procurement issues, GeM portal usage) to the committee, said Shah.
“We expect some kind of decision wherein support will be given to the local contractors.”
In July 2020, a majority of the mineral blocks auctioned by the Geology and Mining Department (GMD) in Kashmir were bagged by non-local mining companies who have won online bids invited by the department.
Before the abrogation of Article 370, the minerals from water bodies were extracted by locals who used to pay a royalty to GMD.
But after the removal of the special status, the market is left open for non-locals who can compete in the e-auctioning for the extraction of mineral blocks.
In Srinagar, all 10 mining blocks have been bagged by non-local contractors against the bid amount of Rs 5.08 crores.
Similarly, in Baramulla district, 38 blocks of minerals have fetched Rs 20.15 crores, out of which 26 have been secured by non-local contractors.
“The mineral blocks were given through e-bidding and successful candidates got the contracts,” an official handling personal section in GMD told Kashmir Observer.
On being asked about the losses incurred by local contractors, he said that amendment has been done in the J&K Minor Mineral Concession, Storage, Transportation of Minerals and Prevention of Illegal Mining Rules.
“Under the amendment, grant of Short-Term Permits to the Panchayati Raj Institutions (PRIs) on land up to 1 hectare is granted till 30th September 2021. It also exempts PRIs from payment of advance royalty to GMD before commencing mining,” the official informed.
However, the anguish is constantly gripping the local contractors and primarily, it has to do with the “gradual disempowerment of Kashmiris” in different sectors and fields.
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