28% tax hike on handmade Kashmiri shawls deals economic blow to IIOJK
Srinagar: Kashmir’s centuries-old handicraft industry faces a grave threat from a proposed 28% increase in GST on shawls valued.
According to Kashmir Media Service, critics argue the move is part of a broader attempt by the Modi-led Indian regime to weaken Kashmir’s economy by targeting its cultural and artisanal backbone.
The GST Council’s Group of Ministers (GoM) on Rate Rationalisation, led by Bihar’s Deputy Chief Minister Samrat Chaudhary, recommended the tax hike, categorizing the iconic Kashmiri shawl as a “luxury item.” The proposal will be discussed at the 55th GST Council meeting on December 21 in Jaisalmer.
Former Finance Minister Haseeb Drabu condemned the proposal, calling it a “misuse of the GST framework.” He explained that the 28% rate is reserved for demerit or luxury goods, such as cigarettes or imported cars, and applying it to Kashmiri shawls is an “absurd misclassification.” “Kashmiri shawls are handmade, labor-intensive products, not luxury imports,” Drabu said. “This decision could devastate the artisanal ecosystem and erode cultural heritage.”
The Kashmir Chamber of Commerce and Industry (KCCI) President Javid Ahmad Tenga highlighted the potential fallout of the GST hike, stressing that over 3 lakh artisans—many of them women and marginalized workers—depend on this industry. “The proposed hike threatens livelihoods and the centuries-old craft of Pashmina weaving, a hallmark of Kashmir’s cultural identity,” Tenga said. “This sector is not just an economic activity; it’s a heritage deeply ingrained in our society.”
Artisans and dealers have expressed concerns about the financial burden of the proposed changes, particularly as they already face challenges with unsold inventory and fluctuating demand.
In a letter to the Commissioner Secretary of Industries and Commerce, the Directorate of Handicrafts warned that the GST hike would have catastrophic consequences for the Pashmina industry. “The Pashmina industry represents the lifeblood of Jammu and Kashmir’s heritage, employing thousands in rural and marginalized communities,” the letter stated. “This proposal would destabilize the sector and endanger the livelihoods of over 2.5 lakh artisans.”
