Real Estate in Kashmir Valley Remains Buoyant
Real estate is the only business in the union territory that is immune to economic volatility
“Former militant commanders and leaders of the Hurriyat Conference, all have links with the real estate business.” – Senior police officer on condition of anonymity
Byline: Bashir Assad
Notwithstanding an economic slowdown in the state, the real estate business in the Kashmir Valley continues be profitable, almost the only one, as it remains unaffected by the current situation and other circumstances.
The horticulture sector (the backbone of the Kashmir economy) has suffered hugely because of an over 30% collapse in market rates. The fruit industry contributes more than 40% to the GDP of Jammu and the Union Territory of Kashmir. However, farmers and dealers alike are facing a tough situation because market rates for the Kashmir apple saw a slide of 30% this season, despite a bumper crop. The real estate sector, however, is rebounding and, in fact, prices for the land bowl are rising steadily.
It is quite interesting to see how fast the real estate business is growing, not only in urban centres like Srinagar city, but in the rural areas as well. The rates for land along the Khanabal-Pahalgam road near Anantnag town is the highest in the country. According to newspaper advertisements and social media networks a flat in Chandigarh costs between Rs 45 lakh and Rs 60 lakh. So, for the cost of a 3-BHK flat in a world-class city such as Chandigarh, a person can purchase 4 or 5 Marlas of land (1 Marla=1,089.004 sq. ft) in Kashmir – for Rs 60 lakh. On the Khanabal-Pahalgam road in Anantnag, 1 Marla of land costs more than Rs 50 lakh.
The unfortunate fact is that black money is supporting the real estate business in Kashmir. The unaccounted-for cash, hawala money in particular, is invested in the real estate sector in the Valley. Economic slowdowns have no impact on this business because those dealing with black money have endless holding capacity. Even if the purchasing power of the common man falls, the market remains unaffected, essentially because the brokers hold on to the property and wait for the appropriate time to sell when prices have recovered.
The gap between the haves and have-nots in Kashmir is widening with each passing day. Huge malls and complexes are coming up across the Kashmir Valley, but the lower middle-class section of society cannot afford even three regular meals a day for their families. It is learnt from reliable government sources that majority of the people in the real estate business are those who at one point or the other were involved in hawala money transactions or are into drug trafficking.
A senior police officer claiming anonymity, told Kashmir Central that foreign money received by separatists had been invested in the real estate business. The business generally runs on cash in the Kashmir Valley. Money changes hands physically, with little or no banking transactions happening. The police officer said that the real estate business had become a dumping ground for black money generated through hawala channels and through the sale of drugs. He alleged that top leaders among the separatists had invested in real estate. “Former militant commanders and leaders of the Hurriyat Conference, all have links with the real estate business,” he said.
The senior police officer explained that there were two dimensions to the real estate business in Kashmir: land grabbing and forced eviction at gun point. All separatist leaders were involved in the land grabbing and forced eviction, he alleged.
Explaining how land grabbing is conducted, he said that this was done in two ways. One is by occupying state and community land by force, he said. Former militant commanders and their workers on the ground, particularly the cadres of the proscribed Jammat-e- Islami, were involved in this kind of land grabbing, he alleged. This included occupying the properties of the exiled minority community, he added.
The other way to grab land was by falsely claiming rights over a disputed property, he explained. Again, separatists were involved in this, he alleged. The property grabbed in this manner was finally converted into a commercial business, he added.
The former president of the High Court Bar Association, Srinagar, Mian Abdul Qayoom, the former chairman of the Hurriyat Conference (G), the late Syed Ali Geelani, through his son, Naseem Geelani, as well as others such as Mohd Yaseen Malik, Shabir Ahmad Shah and Nayeem Ahmad Khan are all allegedly involved in land grabbing. Almost all of them have properties registered in the names of their distant relatives and thus are directly or indirectly involved in the real estate business, according to sources.
Another senior government official, again on condition of anonymity, revealed to Kashmir Central that the huge complexes coming up or which have already come up in and around Srinagar city are built in partnership with separatists or former militant commanders. As billions of rupees have been pumped through hawala channels into the Kashmir Valley by foreign agencies, this money finds its way into the real estate business, he alleged. As the money is unaccounted for, tenants are offered property at unimaginably low prices, keeping the sector buoyant. This is precisely why the value of land in Kashmir Valley is the highest in the country. Though the government has of late taken cognizance of land grabbing and forced eviction and started a drive for retrieval of the same, it has actually benefited only those parties involved in the grabbing. For they have used the land for decades, realised the dividends and have invested elsewhere for future stability. So, any efforts by the government to reclaim the grabbed land does not really harm them.
Another reason offered by industry insiders for high land prices is the unplanned or ill-planned conversion of agricultural land for commercial purposes. The explanation offered is that government agencies acquired the land from tenants to improve road connectivity and infrastructure. People prefer to open commercial businesses along the main roads and offer high prices for land situated along or close to major highways. This has boosted land values.
For all these reasons, real estate remains the only business that seems immune to any economic changes even if the industry remains mostly supported by those dealing in black money. The positive fact is that the authorities are aware of the problem and its magnitude, and the government has initiated steps to resolve the issue. Can the government find realistic solutions for the benefit of everyone? Only time will tell.
