Fiscal Crisis Looms: Jammu and Kashmir CM Warns of GST's Economic Ripple Effects

Jammu and Kashmir's Chief Minister, Omar Abdullah, has sounded an alarm over the proposed GST reforms, cautioning they could further reduce the union territory's revenue by up to 12%. His remarks come amid a severe fiscal crisis, intensified by the Pahalgam terror attack, which has crippled vital sectors of the economy.

In a speech at the 56th GST Council meeting, Abdullah advocated for mechanisms to secure fiscal stability for states and union territories. He emphasized the reforms' potential to stall recovery in Jammu and Kashmir, a region already reeling from significant economic setbacks in tourism, agriculture, and more.

Abdullah appealed to the central government for support, highlighting the necessity of sensible GST rate rationalization complemented by compensatory frameworks. Acknowledging both national and regional challenges, he urged the GST Council to address geopolitical and fiscal strains while ensuring consumer benefits aren't lost to profiteering.

(With inputs from agencies.)