Over Rs 5,000 Crore Loss to J&K Economy Due to Floods: Assocham

New Delhi: Devastating floods in Jammu and Kashmir have caused an immediate loss of Rs 5,400-5,700 crore to the state's economy, with heavy damages to trade, hotels, restaurants, horticulture and handicraft, according to initial estimates by the Associated Chambers of Commerce and Industry.

Jammu & Kashmir has been hit by the worst floods in over a century, throwing basic infrastructure like power, railways and communication in the state completely out of gear.

The initial estimated loss to hotels, trade, agriculture-horticulture, roads and bridges in the Jammu and Kashmir regions itself is Rs 2,630 crore. Besides, high-cost infrastructure like Railways, power and communication in the hilly terrains would have suffered a loss of about Rs 2,700-3,000 crore, the industry body said.

"These are only initial estimates of the loss. The real loss to the Jammu and Kashmir economy will be much higher since the impact of such calamities is long-drawn and it takes long time before the physical infrastructure is restored.

"The biggest worry is the shattering of confidence among the tourists and it will take long time and effort to win back the tourists to the state," Assocham Secretary General D S Rawat said.

Mr Rawat cited the example of Uttarakhand, which also witnessed unprecedented floods last year, saying it was yet to recover from the shocks.

"J&K's economy stood at Rs 45,399 crore in 2013-14. The sectoral composition of state GDP indicates that agri & allied activities account for 20 per cent in the state GDP, industry and mining contribute to about 23.5 per cent and the services sector made up the remaining 56.5 per cent."

"Trade, hotels and restaurant services registered a turnover of close to Rs 3,800 crore during 2013-2014. The tourism industry sources of J&K state roughly distribute the tourists among Jammu, Kashmir and Ladakh region in the ratio of 40:40:20," Assocham said.

"The September-November season tourist inflow both from India and abroad is severely affected as is being witnessed by large scale cancellations. While cancellations for airlines, hotels are 100 per cent upto October 15, those who had booked for winters are watching the situation," feedback from the industry chamber's travel constituents indicated.