Paring Down Unemployment

Aatif dwells on the under performing sector in Kashmir, meaning the private industry

(Mr. Aatif Ahmad Mehjoor, 27, was born in Srinagar. He received his primary education in London and Srinagar, with the final two years at the Burn Hall School. He studied law at King's College London and the University of Oxford. He currently works in the London office of Shearman & Sterling, an international law firm, specialising in the regulation of financial markets. His personal interests are: financial markets & investment, cricket, and ancient history & archaeology.)

A Knowledge Industry in Kashmir

Unemployment remains a serious problem in Kashmir. Despite many efforts by previous governments to address the issue, hundreds of thousands of educated people in Kashmir are languishing at home without any jobs. People have mistakenly pinned their hopes on an endless creation of government jobs, not knowing that the government’s finances are in such a troubled condition that it cannot even pay its existing employees properly, let alone additional employees manning unnecessary jobs.

The only way to deal with this problem is to allow the private sector to create jobs. Although this includes encouraging entrepreneurship and small-scale businesses, in order to create the hundreds of thousands of jobs that are needed to absorb the current unemployed youth, we must also attract an adequate measure of foreign investment.

Kashmir offers tremendous opportunities for foreign investment in a number of areas. It has huge potential for the installation of hydroelectric plants and less than 10% of our capacity has so far been harnessed. There is also much potential to develop the tourist industry on a much higher scale if foreign investors can be persuaded to set up ski resorts, hotels and tour companies. Already, the J&K Tourism Department has made sterling efforts to construct (and reconstruct) valuable assets such as the Royal Springs Golf Course and the Nigeen Club.

There is, however, one area in which Kashmir is ideally suited to excel. It is something that would reinforce our tourist industry, provide tens of thousands of jobs, and deliver innumerable other benefits to our people and economy. It is higher education. This sector could offer Kashmir the chance to specialise in a rapidly evolving and lucrative industry. Recently, the Central Government introduced the Foreign Educational Institutions (Regulation of Entry and Operations) Bill 2010 in the Lok Sabha. If, as is very likely, this Bill becomes law it will be possible for foreign educational institutions to establish colleges, universities and institutes in India and run them for profit. Indian students, who have until now had to spend lakhs of rupees on education abroad, will now be able to obtain such education at home.

The J&K Government should seize the opportunity offered by this initiative and investigate ways of fostering this new industry in Kashmir. It should immediately establish a committee to study the possibility of promoting Kashmir as a centre of higher education and to recommend what measures the Government could take to achieve this end.

Kashmir has all the characteristics of a centre of higher education. In ancient times, Kashmir was a seat of learning in Asia – ‘Sharadapeetha’ – and students flocked from all corners of Asia to study Sanskrit and Buddhism. As most people know, the University of Kashmir has one of the most beautiful campuses in Asia. The attractions of studying in Kashmir are obvious. It is no wonder that Kashmir has already become a centre in India for teacher education: there are now more than 40 ‘B.Ed colleges’ operated by the private sector in Kashmir catering to students from throughout India. In my view, this successful industry proves that there are greater heights to be achieved, provided the Government steps in and takes up its role as facilitator.

There are several steps that could be taken to foster the higher education industry. The J&K Government should introduce its own Foreign Educational Institutions Bill to regulate the entry and operation of foreign universities and colleges in Kashmir. It should come up with a comprehensive set of incentives to encourage the industry. To start with, the Government should acquire a vast tract of land – along the lines of the various industrial estates – and designate it as a ‘knowledge city’. Land in this area would be set aside for foreign investors intending to establish universities, colleges and institutes of higher learning, as well as for ancillary businesses. It would be offered at nominal rates. There would also be incentives based on tax. The Government could emulate what Dubai has done and offer complete exemption from income tax and corporation tax, so that any professionals working in the knowledge city and any institutions in it would pay 0% tax on their incomes. The regulatory environment would aim to place the lightest burden on institutions so that they are attracted to Kashmir rather than any other part of South Asia.

To ensure jobs are created for the people of the state, any foreign institution setting up in the knowledge city would be required to set aside, say, 10% of academic jobs and 30% of the non-academic jobs for state subjects and to allocate, say, 30% of tenders to local contractors.

Dubai’s experiment with establishing higher education as an industry has yielded mixed results. Although the industry survives, it has not really flourished. In large part, this is due to the lack of academic freedom as well as excessively strict residency laws that do not allow expatriate workers to obtain citizenship. It is very difficult to persuade a professor who is an expert in a particular subject to come to a region where his or her views will be constantly monitored and who will always face the possibility of expulsion. To attract foreign academic staff, it is important to enable them to feel a part of the local culture. This means permitting them to attain full citizenship and its concomitant rights (right to own land, etc.) after a certain period of time. This is why the United States and Europe have magnetically attracted thousands upon thousands of the world’s brightest brains to their universities and companies. The Government should therefore enable foreign academic staff who have worked in the knowledge city for a certain number of years (say 5) to become permanent residents of the state (with the right to own real estate), provided they demonstrate in an objective test knowledge of the local culture (including proficiency in a local language).

If properly nurtured, foreign education or ‘educational tourism’ could emerge as a big industry in Kashmir. It would also provide a fillip to other industries and, indeed, give rise to new ones. A large university or institute with an enrolment of tens of thousands of students is a complex animal that creates enormous business for local entrepreneurs and traders. The presence of a large numbers of foreign students and staff would also boost tourism as well as other sectors of Kashmir’s local economy.