The Valley’s Investment Gap

With mutual fund assets at barely 3 percent of GSDP, Jarnmu and Kashmir’s savings culture keeps billions outside India’s main wealth engine.

- Irshad Mushtaq

ashmiris save with discipline and clear purpose. Families build gold reserves, buy land, ‘open fixed deposits, and keep cash ready for life’s major milestones.

‘This culture shows foresight and responsibility. It also draws from history, when land and gold served as the most trusted stores of value in uncertain times. Savings create security, but investment builds wealth.

Let us begin with a simple idea.

GDP means the total value of everything produced in one year. In Jammu and Kashmir, we call it GSDP. It includes apples from Shopian, saffron from Pampore, walnuts from Kupwara. It includes hotels in Gulmarg, houseboats on Dal Lake, taxis in Srinagar, factories in Samba, private schools, hospitals, and government offices.

Recent estimates place J&K’s GSDP between 2.5 and 2.9 lakh crore. That number represents the full size of the economy ina year.

Now ask a sharper question: How much of that economic value flows into mutual funds?

Industry data show that mutual fund assets in Jammu and Kashmir stand near 7,000 crore. Compare that with a GSDP nearing 2.7 lakh crore. The ratio sits around 2.5 to 3 percent.

In plain terms, for every 100 produced in the Kashmiri economy, about 3 finda place in mutual funds.

‘The rest of the savings stay in cash, fixed deposits, gold, plots, and local property.

Place this beside the national picture.

India’s mutual fund assets equal roughly 20 percent of the country’s GDP. For every 100 India produces, around 20 sit inside mutual funds. India itself trails the world’s richest markets.

In Australia, mutual fund assets reach nearly 185 percent of GDP. In the United States, the figure stands around 140 percent. Switzerland approaches 100 percent. Israel and Saudi Arabia both sit in the 20s.

India works to deepen its financial markets. Kashmir remains far below even the Indian average.

Look within India and the contrast grows sharper.