Boldest Kashmir Move in 70 Years Boosts Modi, Provokes Pakistan

(Bloomberg) -- Prime Minister Narendra Modi's decision to revoke seven decades of autonomy in the disputed Muslim-majority state of Kashmir has consolidated his position as strongman and started a new chapter in Indo-Pakistan relations.

The move to make Kashmir a ‘union territory' -- similar to India's capital Delhi -- gives Modi's federal government complete control over the state's local police machinery. The promises made in his ruling Bharatiya Janata Party's manifesto in the 2014 and 2019 election campaigns -- where he courted the votes of the Hindu majority -- have been kept in less than 100 days of his landslide electoral victory.

Withdrawing the autonomy of Jammu and Kashmir, as the state is formally known, earns Modi a breather from negative news on the country's economy as attention moves away from the government's ill-conceived sovereign borrowing plans, slowing growth and rising joblessness.

Yet it risks worsening India's already fraught security relationship with rival Pakistan and raises the possibility of a renewed insurgency in the troubled region.

"Given that Islamabad has long claimed Jammu and Kashmir, any unilateral move by India that changes the region's status is sure to concern -- and alarm -- Pakistan," said Michael Kugelman, deputy director of the Asia Program at the Washington-based The Wilson Center. "The risks of violence have risen significantly. The bottom line is India may believe that this move will bring more clarity to the Kashmir issue by formally integrating the region into the union of India, but there are all kinds of risks and uncertainties ahead."

Islamabad Protests

Pakistan strongly protested against India's actions.

In a statement released Monday, Pakistan's Foreign Ministry condemned the move and pledged to exercise all possible options to counter what it described as New Delhi's “illegal steps.”

Meanwhile Pakistan's parliamentarians are set to hold a joint sitting on Tuesday to discuss the deteriorating situation in Kashmir and India's legislative steps, according to state-run Radio Pakistan.

One option for Pakistan is to go to the United Nations Security Council, noted Rustam Shah Mohmand, a former Pakistani ambassador to Afghanistan. He said the UN's own resolutions have been violated by India in this case.

"The ultra-right Hindu ideology triumphed in trampling democracy and human rights," Mohmand said. "India through this act seems to have preempted the agenda of forthcoming Trump-Modi meeting in which Trump was very much likely to offer mediation to India on Kashmir."

Last week, India rebuffed U.S. President Donald Trump's offer to mediate between the south Asian nation and Pakistan, which have long-running tensions centering on Kashmir, an area that's claimed in full -- and ruled in part -- by both. In late February, Modi's government authorized airstrikes against Pakistan in response to a terrorist attack in Kashmir.

Still, Trump's offer to mediate seems to have boosted Pakistan's confidence, said G. Parthasarathy, former Indian high commissioner in Pakistan.

"Pakistan seems to now be under the impression that they can do anything in the region as long as they give Trump an exit from Afghanistan before US elections," Parthasarathy said.
"India today sought to send out a message to Pakistan and Kashmiris that it means business. That things will not continue as before."

Kashmir Autonomy

Under Article 370 of the constitution, the state of Jammu and Kashmir enjoyed complete autonomy and the state legislature was free to draft its own laws except in the areas of communications, defense, finance, and foreign affairs, while Indian citizens were prohibited from purchasing land in the state.

It was especially drafted in the 1950s after the kingdom of Kashmir agreed to join the Indian republic. The ruling Bharatiya Janata Party had pledged to scrap the article in its electoral manifestos of 2014 and 2019.

"Article 370 should have been revoked much earlier," Home Minister Amit Shah told India's parliament Monday. "But it needed political will. And the Modi government has the political will to do it."

Kashmir's failure to advance the rights of women, protect children and implement laws and quotas to benefit lower caste citizens meant India's government had to act, said a senior foreign ministry official who asked not to be named as they were not authorized to speak to the media.

It is not just about owning land, they said. The federal government had sent $40 billion to Kashmir over the last few decades, yet the state has little to show in terms of development.

In the lead up to the controversial step, prominent political leaders in Indian-administered Kashmir -- including former chief ministers Omar Abdullah and Mehbooba Mufti -- were placed under house arrest and the Indian paramilitary forces deployed thousands of extra troops across the valley in one of the most widespread security crackdowns in recent years.

India also evacuated thousands of tourists, students and pilgrims -- citing terrorist threats -- and restricted phone and Internet services.

New Delhi's actions show the opinions of the citizens of Kashmir do not matter, said Khalid Shah, Delhi-based fellow at the Observer Research Foundation. "That's a scary situation for any democracy. My sense is that this will lead to long term political consequences and will prolong the conflict."

India's benchmark stock index S&P BSE Sensex dropped 1.1% to the lowest since March 8, while the rupee weakened 1.6% to end at 70.7325 per dollar in Mumbai.

Army on Standby

The Indian Army said Monday it was on standby for any contingency in Kashmir. The official, who asked not to be identified citing rules, said while no additional soldiers had been sent to the region, central security forces had added an extra 10,000 personnel, bringing the total number to 45,000.

India's arrest of political leaders without an explanation is “unprecedented,” Akhil Bery, South Asia analyst at risk consultancy Eurasia Group, said in an email.

“It has the potential to embolden Pakistan-based terrorists to begin ramping up attacks again,” said Bery. “This also fits into Imran Khan's narrative that India is the one responsible for escalating the tensions -- he managed to convince President Trump of that and this is only going to support his message further.”

To contact the reporters on this story: Archana Chaudhary in New Delhi at achaudhary2@bloomberg.net;Ismail Dilawar in Karachi at mdilawar@bloomberg.net

To contact the editors responsible for this story: Ruth Pollard at rpollard2@bloomberg.net, Unni Krishnan