The tourism sector is the main driver of Jammu & Kashmir’s economy and contributes around 7.4% to the gross state domestic product (GSDP) of J&K and employs around 1 million people directly and indirectly
The terrorist attack in Kashmir’s Pahalgam on April 22, which took the lives of nearly 26 tourists and injured several others, has sent shockwaves across the region and the country. The tragic incident just ahead of the upcoming peak tourist season is expected to have a severe impact on UT’s tourism-driven economy.
The tourism sector is the main driver of the UT’s economy and contributes around 7.4% to the gross state domestic product (GSDP) of J&K and employs around 1 million people directly and indirectly. Hence, the flow of tourists plays a crucial role in the economy.
“When in the run-up to the peak season, an incident like this occurs, then you can understand that tourism will be impacted. It will create a problem, not just where the foreign revenue is concerned, but where employment prospects are concerned especially because tourism is an extremely labour-intensive sector,” Dr. Dipankar Sengupta told Outlook Business. Sengupta is a Professor of Economics at the University of Jammu.
The sector employs all kinds of labour, including skilled, semi-skilled and unskilled, he added.
While the tourism sector comprises many stakeholders, including hotel owners, travel agents, etc., those in the bottom of the pyramid like tour guides, shikara drivers and horse ride facilitators, who mainly earn wages daily will be severely impacted, Prof. Nimit Chowdhary told Outlook Business. Chowdhary has formerly worked with the Indian Institute of Tourism and Travel Management.
“Attack on tourist, is an attack on tourism, a key driver of Kashmir’s economy. Those in the bottom of the travel business pyramid will be more affected in the short-run,” Chowdhary added.
According to J&K’s department of tourism data, the footfall increased from 1.62 crore tourists in 2019 to 2.12 crore tourists in 2023, with the May-July period recording the highest footfall. Domestic arrivals in J&K increased significantly from 1.61 crore in 2019 to 2.34 crore in 2024. Meanwhile, the foreign footfall rose from 57,920 tourists in 2019 to 65,452 tourists in 2024. In the year 2024, the UT recorded its peak footfall with 2.36 crore tourists, according to J&K’s economic survey.
In 2023, the G20 Tourism Working Group meeting was held in Srinagar as a part of the government’s strategy to revive tourism in J&K. In the meeting, the government had also launched a draft J&K Film Policy to leverage the role of films in tourism promotion.
Prior to this in 2020, the government had introduced a tourism policy for the UT with an aim to generate over 50 thousand jobs and private investment of around Rs 2000 crore on a yearly basis for the period of five years.