J&K lags in FDI, attracts just Rs 10.5 Cr in 6 years

Srinagar, Sep 7: Nearly six years after the abrogation of Article 370, Jammu and Kashmir has emerged as the lowest performer in attracting Foreign Direct Investment (FDI) among all Indian states and union territories.

According to official data from the Department for Promotion of Industry and Internal Trade (DPIIT), the Union Territory received only Rs 10.5 crore in FDI equity inflows between October 2019 and March 2025 — a minuscule 0.0005% of India’s total Rs 22,08,578 crore during the same period.

The figures are in stark contrast to the promises made after August 2019, when the Centre projected J&K as a future investment hub. Authorities claimed the removal of the region’s special constitutional status would open the floodgates for foreign and domestic capital, creating jobs and boosting growth. Six years later, the expected boom has failed to materialise.

Between October 2019 and September 2024 alone, J&K managed just Rs 10.5 crore in inflows. The year-wise breakdown underlines the weak trend: Rs 1.67 crore in 2020–21, Rs 1.23 crore in 2021–22, Rs 6.03 crore in 2022–23, a mere Rs 0.02 crore in 2023–24, and Rs 1.57 crore in the first half of 2024–25.

The contrast with other regions is striking. Dadra and Nagar Haveli and Daman and Diu — far smaller in geography and population — drew Rs 1,343 crore, 129 times more than J&K. Arunachal Pradesh received Rs 53.25 crore, Assam Rs 179.67 crore, all ahead of J&K.

Ladakh, carved out of J&K in 2019, attracted Rs 1.70 crore FDI inflow.

India’s FDI remains concentrated in a handful of large states. Maharashtra topped the list with Rs 6,97,304 crore, accounting for 31.36% of the national inflow, followed by Karnataka with Rs 4,45,513 crore, Gujarat with Rs 3,47,572 crore, Delhi with Rs 2,95,613 crore and Tamil Nadu with Rs 1,15,346 crore. Together, these five accounted for 86.17% of total inflows.

Even mid-tier performers left J&K behind. Haryana attracted Rs 1,01,869 crore, Telangana Rs 86,211 crore, Rajasthan Rs 21,222 crore, Jharkhand Rs 19,443 crore and Uttar Pradesh Rs 16,316 crore. Lower-tier states also fared better: West Bengal Rs 14,932 crore, Kerala Rs 10,882 crore, Punjab Rs 9,377 crore, Himachal Pradesh Rs 2,882 crore and Uttarakhand Rs 1,729 crore.

Among union territories, Chandigarh registered Rs 896 crore and Puducherry Rs 675 crore — both many times higher than J&K. In the northeast, Arunachal Pradesh with Rs 53.25 crore and Assam with Rs 179.67 crore outpaced J&K, while even Tripura with Rs 9.75 crore and Meghalaya with Rs 9.08 crore nearly matched it. Comparisons show J&K attracting 129 times less than Daman and Diu, 17 times less than Assam, five times less than Arunachal Pradesh, and less even than Ladakh.

Analysts cite multiple reasons for the UT’s poor showing: persistent security concerns that make investors risk-averse, infrastructural bottlenecks including power and connectivity gaps, higher logistics costs due to market isolation.

The implications are severe. With India attracting over Rs 22 lakh crore in FDI during this period, Jammu and Kashmir’s negligible inflow translates into fewer jobs, slower industrialisation, and continued dependence on government transfers.

The Centre has announced major connectivity projects in recent years, including railway expansion, highways and new industrial estates. It also unveiled plans for a Global Investors’ Summit in 2019, projecting over Rs 1 lakh crore in commitments. Most of those pledges, however, have remained on paper.