About the Institute JKEDI was established by the Government of J&K in March 1997 as a society of the Government of Jammu

& Kashmir to help the Government in conceptualizing, formulating and implementing strategies for creating an enabling environment for entrepreneurship development in the state. The Institute was given the mandate to help, train and mentor aspiring and practicing entrepreneurs through awareness, education, training, consultancy and research. The Institute started its regular activities from February, 2004 and has since been playing a significant role in creating a pro-entrepreneurial environment to foster the progress and prosperity of the State. The Institute is established in three regional centres at Srinagar, Jammu and Leh. The Institute in its short period of existence has been able to position itself as a learning centre par excellence having state of art infrastructure in all its campuses. The Institute currently functions out of three campuses; one each in the provinces of Kashmir, Jammu and Ladakh. The institute plans to have sub-regional campuses in all the 22 districts of the State. 1. Director of jkedi Dr. M. I. Parray

Economic Structure of J&K

Smaller Default Larger The pillars of any state rest on the building blocks of Economy, Environment, Education, Employment and Healthcare. Although each block is important for the stability and growth of a civilization but Economy is the corner stone on which the prosperity of a state rests. When we talk of measuring the size and performance of any economy we take assistance from time tested and globally accepted quantitative techniques of economics. One such prime indicator of measuring national income is the Gross Domestic Product (GDP). Lets do some math: Fig: J&Ks GSDP growth Vs National GDP growth rate since 2005-06: J&K contributes approximately 0.76 % to national GDP and ranks 20th in the list of contributing states. As shown in the above graphical representation the national GDP growth rates have slumped from 9.48% in 2005-06 to 6.88% in 2011-2012 while as J&Ks Gross State Domestic Product (GSDP) growth rate has shown an improvement from 5.78% to 6.78%. Thanks to deteriorating national GDP numbers we have somehow managed to catch up with the national aggregates. Another important point to understand here is the base on which the growth multiplication factor is applied which in case of National GDP is huge compared to small sized GSDP of J&K. Therefore even a small percentage growth on a bigger base means proportionally bigger incremental growth to National aggregates in absolute terms compared to a small GSDP base of J&K. In addition to GSDP one of the concerning indicators of our state economy is the fiscal deficit. We are among the states with highest fiscal deficit in the country which measures to 4.62% for FY 2012 ranking 3rd in the worst list of deficits after Manipur and Pondicherry and irony is that we rank 2nd in the list of highest grant receiving state from central govt. which amounts to 7.55 billion USD. This makes J&K the most indebted state with a debt-GSDP ratio of around 60%. Debt-to-GSDP ratio is an indicator of health of an economy. A lower debt-to-GSDP ratio means an economy is producing enough to pay back its debts. A higher debt-to-GSDP ratio is a highly unfavorable situation. Now a cherry on the cake; RBI in its latest publication dated

10th Jan 2013 reduced the target Debt-GSDP ratio for J&K state to 49.3 % (2014-15) which boils down to reducing the numerator or in other words it means paying back a substantial amount of money to the central govt. Another socio-economic indicator of Jammu Kashmir is the per capita income which in case of J&K is Rs 24,214.00 which is quite low as compared to the national average of 33,283.00 and we rank 21st in terms of per capita income among all the Indian states. Sectoral composition of J&Ks GSDP: The three components of J&Ks GSDP are Agriculture & Allied sector, Industry & Manufacturing and Services. The respective contribution of these sectors during 2011-12 was 19.35 %, 26.41 % and 54.24 %. During the last few years of planning between 2004-05 and 2011-12, the share of agriculture in GDP has fallen by approximately one third from 28.00% to 19.35%, whereas the share of industry has decreased from 28.23% to 26.41% and the share of services has improved from 43.71% to 54.24%. It is observed that services sector is emerging as an important growth driver and the manufacturing sector is relatively stagnant while agricultural productivity has decreased significantly. It is a point of concern that the combined contribution from primary and secondary sectors is becoming less than the lone contribution from service sector which is a very unhealthy condition for sustaining growth in the long run. Identifying the weak link: J&K needs to focus on its weakest contributor Agriculture which ironically supports more than 60% of employment and the effects can be easily seen in the disparity ratio between average incomes of agriculturists and non-agriculturists which has been increasing since long. This means that a major population (60% people) of J&K is becoming poorer. Also, keeping in consideration the scope of expansion in Manufacturing sector and Service sector (primarily with tourism industry under its kitty) the major bottle neck that can hold us back is the Agriculture sector. The agricultural sector has shown a lower performance due to a number of factors such as illiteracy, insufficient finance, insufficient irrigation facilities, power availability, inadequate marketing facilities and under pricing of agricultural products. The average size of the farms is very small and approximately 90% of land holdings are of the size of 2-4 Kanals, which in turn results in low productivity. The sector has not adopted modern technology and agricultural practices to a larger extent. Also decline in plan allocations investment and investment credit are contributing factors.

Table 1. Shows the number of SSI units registered and employment.

No. of units

Incremental change

Growth rate

No. of employment

Incremental change

Growth rate

Year 1973-1974 1977-1978 1980-1981 1985-1986 1989-1990 1990-1991 1991-1992 1992-1993 1993-1994 1994-1995 1995-1996 1996-1997 1997-1998 1998-1999 1999-2000 2000-2001 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010

2203 3498 4828 18520 28168 29963 32250 33445 34548 35592 36821 38029 39436 40267 41950 42808 43689 44707 45672 46818 48224 49426 50472 51443 52631

1295 1330 13692 9648 1795 2287 1195 1103 1044 1229 1208 1407 831 1683 858 881 1018 971 1146 1404 1202 1046 971 1188

58.78 140.94 119.74 52.09 6.37 7.63 3.71 3.30 2.93 3.45 3.28 3.70 2.10 4.17 2.04 2.05 2.33 2.17 2.50 3.00 2.49 2.12 1.92 2.30

8812 17252 42992 84821 123472 131164 141791 146143 150628 154692 159617 165064 171962 178004 183698 187399 193285 197578 203428 209322 219127 225963 230552 235918 243411

25740 41829 38651 7692 10627 4352 4485 4064 4925 5447 6898 6042 5694 3701 5886 4293 5850 5894 9805 6836 4859 5366 7493

149.20 97.29 45.57 6.23 8.18 3.07 3.07 2.70 3.22 3.38 4.18 3.51 3.20 2.01 3.14 2.56 2.96 2.89 4.68 3.11 2.03 2.32 3.00

Source: - Digest of Statistics, Directorate of Economics and Statistics

Table 2. Shows the estimated value of employment in the SSIs in Jammu and Kashmir. Year

Actual employment (Y)

Estimated employment = a+bx

1973-1974 1977-1978 1980-1981 1985-1986 1989-1990 1990-1991 1991-1992 1992-1993 1993-1994 1994-1995 1995-1996 1996-1997 1997-1998 1998-1999 1999-2000 2000-2001 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010

8812 17252 42992 84821 123472 131164 141791 146143 150628 154692 159617 165064 171962 178004 183698 187399 193285 197578 203428 209322 219127 225963 230552 235918 243411

12483.85 18181.85 24033.85 84278.65 126729.85 134627.85 144690.65 149948.65 154801.85 159395.45 164803.05 170118.25 176309.05 179965.45 187375.05 191145.85 195022.25 195501.45 203747.45 208759.85 214976.25 220265.05 224867.45 229139.85 234367.05