Srinagar, Oct 04: A robust wave of economic hope is sweeping across Jammu and Kashmir following the government's reduction of Goods and Services Tax (GST) rates from 12% to 5%. The decision is likely to spur tourism, revive traditional crafts, and spur agriculture, generating new employment opportunities and expanded market access throughout the UT.

Tourism operators welcome the tax reduction, claiming it comes in time. With tariffs under Rs 7,500, hotels are now eligible for just 5% GST, and tourism to Kashmir and Jammu will be cheaper. "Tourists will linger longer and spend more within the local community. It's a double whammy for tourists and the economy," claimed Gulmarg hotelier Abdul Majid. Tourist numbers reached 2.3 crore in 2024, and the new reform is likely to drive the figure higher this year.

The step is also being welcomed as a huge shot in the arm for the handicraft and handloom industries that employ more than 3.5 lakh individuals, a good number of them women. On the list are traditional arts like Pashmina shawls, silk carpets, papier-mâché, and wood carvings that will now be more competitive and tourist-friendly. "Lower taxes mean fair prices for customers and better income for artisans," said Bashir Ahmad, a weaver from Kanihama.

The classic GI-stamped Pashmina trade, with the assistance of almost 5,000 skilled artisans, is likely to experience growth in domestic as well as export demand. An equally swift increase is likely for Basohli paintings from Kathua and walnut woodcarvings of Budgam and Srinagar, which are tourists' favourite souvenirs.

Farming also has a benefit to derive. The GST cut will relieve expenses on walnut and almond farmers, who together constitute an important sector of the rural economy. Jammu and Kashmir alone accounts for more than 90% of India's almond production, and the change is expected to improve farmer incomes as well as reinforce value-added exports.

Local food heritage will also gain, as GI-tagged Udhampur Dogra cheese will see increased market access. Lower tax burden will also boost small dairy units and increase interest in food tourism.

Authorities state the GST reduction is part of a larger drive for balanced growth. By reducing expenses and stimulating expenditure, it connects tourism, culture, and local business. As an artist in Srinagar phrased it, "This change gives hope that our art and our economy can grow side by side."

The mood in Jammu and Kashmir is optimistic, as the reform holds the promise not only of lower taxes but greater faith in the economic prospects of the UT.