New Delhi: Chief Minister Omar Abdullah on Wednesday urged the Centre to extend urgent financial support to Jammu and Kashmir, warning that the Union Territory’s economy had been left paralysed by the Pahalgam terror attack of April 22 that killed 26 people.
Speaking at the 56th GST Council meeting, Abdullah, who also holds the finance portfolio, said public revenues had “collapsed” since the attack, pushing J&K into a severe fiscal crisis. Key economic sectors including tourism, handicrafts, horticulture, agriculture, transport, and construction had come to a “standstill,” he added.
Abdullah cautioned that the Centre’s proposed GST reforms, which could trim UT revenues by 10–12 per cent, would worsen the situation unless safeguards were put in place. He stressed the need for a compensation mechanism to protect states and UTs during rate rationalisation.
“The flight of non-local workers has slowed infrastructure projects, businesses have shut down, jobs have been lost, and every major economic activity has been disrupted,” Abdullah said.
While endorsing the two-tier GST structure of 5 and 18 per cent, he urged that the benefits of rationalisation must reach the common man, warning against profiteering. “Safeguards are needed to ensure reduced rates translate into lower consumer prices,” he said, welcoming proposals to address compliance complexity and duty distortions.
The CM also highlighted larger national concerns, pointing out that India’s growth trajectory was being tested by “geopolitical challenges” and “whimsical trade policies of the colonial era” that risked blocking access to 20 per cent of global markets—jeopardising livelihoods in sectors like agriculture, handicrafts, marine products, and gems and jewellery.
Recalling that GST, launched in 2017, was India’s most ambitious tax reform, Abdullah said significant progress had been made in efficiency and compliance. However, he warned that the current crisis required urgent Centre-UT cooperation to stabilise Jammu and Kashmir’s economy.
