March 2007 | Peaceworks No. 59
Shahid Javed Burki
Kashmir: A Problem in Search of a Solution
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Summary
The ongoing territorial dispute between India and Pakistan over the status of the contested
areas of Jammu and Kashmir (henceforth Kashmir) is well known and well documented. This
study acknowledges that any resolution of this dispute may be many years in the making.
Thus, rather than proposing solutions to the territorial conflict, the study explores the utility
of forging enhanced economic opportunities for the people of the region and argues that
doing so may prepare the ground for the eventual resolution of the dispute. Many of the proposals
advanced here will require all the parties to the dispute—India, Pakistan, and the people
of the divided state of Kashmir—to agree on a suite of programs that would bring about
positive economic change from which there cannot be any turning back. I believe that such
positive change would create vested interests and beneficiaries that would resist any retrenchment
from continued progress.
Pakistan may require particularly robust focus because it must deal with unique incentives to
spoil such normalization, as numerous parties there currently benefit from sustained conflict
with India. Indeed, Pakistan—perhaps more so than India—has already paid a heavy price
for the conflict, particularly for its reliance on political and even militant Islam as an integral
aspect of the country’s defense strategy and domestic policies. As a consequence of decades
of instrumentalizing Islam for political reasons, militant and obscurantist versions of the
religion have become entrenched within layers of Pakistan’s civil society and have affected
Pakistan’s political and social development.
Although India has not suffered in this way, it has incurred a different set of costs for its own
intransigence in the face of the Kashmir dispute. While India’s Kashmir war was fought on a
conventional basis early on, the conflict did not affect its society or the political system beyond
the disputed territory of Kashmir. However, an argument can be made that the Kashmir dispute
has migrated throughout India and has become intertwined in long-standing communal
conflicts between proponents of Hindu nationalism (Hindutva) and India’s own Muslim communities,
as evidenced by the recent episodic massacres of Muslims (e.g., the riots associated
with the demolition in 1992 of the mosque at Ayodhya and communal riots in Gujarat in
2002). For a time, Kashmir’s distance from India’s main population centers somewhat distanced
the conflict from Indian society. However, this situation has changed in recent years
with terrorist attacks in India’s hinterland and even in the evolving relationships between the
ostensibly secular state of India and its various religious communities. Needless to say, the
Kashmiris themselves, particularly those living in Indian-administered Kashmir, have borne the
direct brunt of the violence perpetrated by Indian security forces and Islamist militants, and
have had to survive the devastation of the civil war.
While the direct costs borne by all parties to the dispute have been enormous, the opportunity
costs have been equally significant. Although both governments tend to downplay the actual
costs of the conflict, there is little evidence that either side understands—or even considers—the extent of these opportunity costs. Furthermore, the governed people are scarcely aware
of the magnitude and kinds of opportunities that have been sacrificed. Entering these notions
of the conflict’s direct and opportunity costs into public debate may be an important step in
cultivating constituents for normalization and resolution of the dispute.
This study makes two major contributions to the massive literature on the Kashmir dispute and
proposals to “resolve” it. First, it posits the notion of opportunity costs and provides some
estimates as to their magnitude. It is hoped that once the respective publics understand the
full range of impacts of their governments’ policies, they may demand new approaches. Second,
the study proposes a number of means of creating new economic opportunities to create
new constituencies for peace. This contribution relates to the first because it suggests that
opportunity costs are imposed not only by the actions of Islamabad and New Delhi but also
by their inaction. By failing to consider and pursue innovative economic ideas, the capitals are
imposing another lost opportunity on their peoples and the Kashmir populations living under
their respective control.
The new opportunities explored here involve moving along three fronts simultaneously. First,
India should grant autonomy to the state well beyond that promised in Article 370 of its Constitution.
Second, India and Pakistan should allow the free movement of people, goods, and
commodities between Pakistan and the part of Kashmir India occupies. The most appropriate
way of achieving this would be in the context of the South Asia Free Trade Area, which, having
become operational on January 1, 2006, is likely to evolve in terms of its scope and geographic
coverage. Third, India and Pakistan should become partners, so that they—along
with a community of international and bilateral donors—might consider launching a massive
program of economic development and reconstruction on both sides of the border. Although
the program suggested in this study would cost $20 billion over a ten-year period, it would
roughly double the state’s gross domestic product growth rate to 9.5 percent a year, significantly
reduce the pool of poverty, and better integrate the economies of the two parts of the
state with Pakistan and northern India, respectively. This, in turn, would set the stage for the
ultimate resolution of this long-standing conflict.
About the Author
Shahid Javed Burki is a former vice president of the World Bank, where he worked from
to 1999. He also served as finance minister of Pakistan in 1996–97. In 2004 he was at
Woodrow Wilson Center for International Scholars, where he began work on his latest
Historical Dictionary of Pakistan, which was published by Scarecrow Press in 2006.
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