Kashmir Inc welcomes Union Budget 2026–27, seeks targeted push for J&K economy

Srinagar, Feb 1: Kashmir’s leading trade, industry and tourism bodies have broadly welcomed the Union Budget 2026–27, presented by Union Finance Minister Nirmala Sitharaman in Parliament on Sunday, terming it balanced, growth-oriented and supportive of business sentiment, while simultaneously underscoring the need for region-specific interventions to address Jammu and Kashmir’s unique economic challenges.

The Union Budget has proposed an allocation of ₹43,290.29 crore for Jammu and Kashmir for the next financial year, nearly ₹2,000 crore higher than the revised estimates of the current year. Industry leaders said the enhanced allocation signals the Centre’s intent to support the Union Territory, though concerns remain over the absence of a dedicated industrial revival package.

Budget Positive, Implementation Key for J&K: KCC&I

President of the Kashmir Chamber of Commerce and Industry (KCC&I), Javid Ahmad Tenga, described the Budget as positive, with a clear thrust on improving the business environment and sustaining GDP growth.

“It is a good budget, with focus on improving the business environment and overall economic growth. KCC&I has been of the opinion that there should be an increase in grant-in-aid to Jammu and Kashmir, and that has happened. J&K has got around ₹2,000 crore more. While we would have preferred a higher allocation, given our dependence on central funding to meet expenditure, this increase is still welcome,” Tenga said.

He also welcomed the reduction in taxes on cancer drugs, calling it a relief for patients and families facing high healthcare costs. However, he expressed disappointment over the absence of a fresh industrial package for Jammu and Kashmir.

“We had strongly demanded an industrial package, especially as the capital allocation under the New Central Sector Scheme (NCSS) for the J&K industrial sector has been exhausted. We hope this concern will be addressed going forward,” he said.

Terming the Budget balanced, Tenga stressed that its real success would depend on implementation. “Proper implementation at the UT level will ensure that the benefits of this Budget reach people across all sectors,” he added.

He noted that provisions have been made for industry, MSMEs, semiconductors, education, defence, agriculture and sports, ensuring broad-based growth. “The enhanced allocation to J&K sends a clear message that the Union Government is serious about the development of the Union Territory,” Tenga said, adding that stakeholders would closely watch the upcoming J&K budget session.

FCIK Welcomes MSME Push

The Federation of Chambers of Industries Kashmir (FCIK) welcomed the Budget’s emphasis on manufacturing, MSMEs, exports and capital expenditure, stating that these measures could bring stability to the MSME and manufacturing ecosystem nationally.

However, the federation expressed disappointment over what it termed the neglect of Jammu and Kashmir’s region-specific industrial concerns, despite repeated representations by the UT administration and industry bodies.

FCIK pointed out that J&K, despite its potential in MSMEs, textiles, handicrafts, agro-based industries and exports, continues to face structural challenges aggravated by prolonged unrest, the 2019 reorganisation and the COVID-19 pandemic.

“In this context, the industry had strongly expected a dedicated package and targeted fiscal measures for existing and stressed units. The absence of such interventions is a missed opportunity,” FCIK said.

While acknowledging national initiatives such as accelerated capital expenditure, MSME liquidity and equity support, export competitiveness measures, the Self-Reliant India Fund and incentives for technology adoption, FCIK stressed that pan-India policies alone would not be sufficient.

“If complemented with region-specific incentives and focused implementation strategies, these initiatives can unlock the industrial and entrepreneurial potential of Jammu and Kashmir,” the federation said, while also expressing concern over what it described as a modest ₹2,000 crore increase in central allocations.

JKHARA Welcomes Budget

President of the Jammu and Kashmir Hotels and Restaurants Association (JKHARA), Babar Chowdhary, welcomed the Union Budget, saying its overall economic thrust would have a positive impact on tourism and allied sectors.

“The Budget reflects continuity in economic reforms and infrastructure development, which are critical for tourism. Any improvement in connectivity, disposable incomes and overall economic stability directly benefits the hospitality sector in Jammu and Kashmir,” Chowdhary said.

He added that support for MSMEs, skilling and infrastructure would indirectly strengthen tourism-driven livelihoods. “Tourism is a major employment generator in J&K, and a stable macroeconomic environment will help the sector recover and grow sustainably,” he said.

Traders See Relief but Seek Localised Measures: KTA

President of the Kashmir Trade Alliance (KTA), Aijaz Shahdhar, said the Budget carries positive signals for traders and small businesses.

“Measures aimed at improving liquidity, supporting MSMEs and boosting infrastructure are welcome. These steps can ease pressure on traders who have faced multiple economic shocks over the past few years,” he said.

However, Shahdar stressed the need for region-specific interventions. “Jammu and Kashmir’s trading community has unique challenges. Targeted relief measures and easier access to credit at the local level are essential for meaningful recovery,” he added.

Inclusive Vision, Agriculture and Tourism Gains Highlighted:  PHDCCI Kashmir

PHD Chamber of Commerce and Industry (PHDCCI) Kashmir Chapter also lauded the Union Budget’s inclusive vision. Chairman of PHDCCI Kashmir, Vicky Shaw, described the Budget as a progressive blueprint for holistic development.

“We welcome that J&K has been allocated ₹43,290 crore, nearly ₹2,000 crore more than the current year. This enhanced allocation reflects the government’s sustained commitment to the region’s accelerated growth,” Shaw said.

Emphasising implementation, he added, “We are confident that the UT government, under the leadership of the Chief Minister and Lieutenant Governor, will allocate this budget in line with stakeholder priorities. The judicious utilisation of funds is crucial.”

Highlighting key sectoral announcements, Shaw said the Budget’s focus on MSMEs, next-age skilling and liquidity support through TReDS would strengthen the business ecosystem. He particularly welcomed the increase in the Kisan Credit Card loan limit from ₹3 lakh to ₹5 lakh.

“This will significantly enhance financial access for farmers, boost agricultural productivity and strengthen the rural economy in Jammu and Kashmir,” he said.

Shaw also highlighted initiatives for textiles, women-led enterprises, tourism and infrastructure. “The integrated textiles programme will revitalise our handicrafts sector, while SHE Marts will empower women entrepreneurs. Promotion of the Buddhist circuit, sustainable mountain trails and training of tourism guides will professionalise tourism and create jobs,” he said.

Reiterating a collaborative approach, Shaw said, “This Budget provides a robust framework for balanced and sustainable development, and PHDCCI Kashmir remains committed to working with all stakeholders to translate its intent into outcomes.”