The April 22 terror attack on tourists in Pahalgam, Kashmir, which left at least 26 dead and several others injured, is more than just a horrific act of violence. The deadliest such incident since the abrogation of Article 370 in 2019 is likely a strategic attempt to undermine the fragile economic resurgence that the region has painstakingly built in recent years. The timing, the target and the aftermath all point toward a deliberate effort to stall the economic momentum that has begun to erode the influence and recruitment base of separatist and terror groups.
Tourism is not just an industry in Kashmir - it is the backbone of its economy, directly and indirectly supporting hundreds of thousands of livelihoods. In the past few years, the region has witnessed an unprecedented boom. In 2023, a record 2.1 crore tourists visited Jammu & Kashmir, filling hotels to capacity and attracting major investments from both domestic and international players. The sector was projected to contribute up to 8.47% of the Union Territory's GDP, with ambitions to double that share in the coming years. This growth has had a tangible impact on the ground. Young Kashmiris, once vulnerable to the lure of militancy due to high unemployment and lack of opportunity, have increasingly turned to entrepreneurship, hospitality and allied sectors. The economic optimism has not only improved individual lives but also weakened the separatist narrative that feeds on despair and joblessness. The attack in Pahalgam was not random. It struck at the heart of the region’s peak tourist season, in a location known for its beauty and accessibility to pilgrims and travelers alike. By targeting civilians - especially Hindu outsiders - the perpetrators aimed to: > Instill fear among potential visitors, leading to mass cancellations and a sudden drop in revenue. > Shatter the image of normalcy and safety that the government has worked hard to project, both to Indian citizens and the international community. > Undermine investor confidence, jeopardizing ongoing and future projects that could further integrate Kashmir into the national economic mainstream. The immediate aftermath has been devastating. Reports indicate up to 90% cancellations in some segments, with hoteliers, taxi drivers and small business owners suddenly facing the prospect of loan defaults and financial ruin. The ripple effect threatens not just tourism but the entire tertiary sector, which accounts for over 60% of the region’s gross value added. There is compelling evidence that economic development, especially through tourism, directly undermines the recruitment strategies of separatist and terrorist groups. Studies and policy analyses consistently find that as young people gain access to stable jobs and rising incomes, the appeal of militancy diminishes. In the late 1990s and early 2000s, high youth unemployment was a key driver of insurgent recruitment. Today, with new businesses and employment opportunities, the separatist narrative is losing ground. For terror groups, this is an existential threat. Every successful entrepreneur, every family lifted out of poverty, is a loss for their cause. By attacking tourists and disrupting the economy, these groups hope to restore the climate of fear and uncertainty in which their ideology thrives. The attack is likely to have far-reaching consequences. Risk-averse investors may withdraw or delay projects, stalling infrastructure and job creation. Both domestic and international tourists may avoid the region, reversing years of painstaking image-building. And economic setbacks can breed frustration and resentment, potentially creating a new pool of recruits for extremist groups. The Valley’s resilience will be tested, but history shows that the people of Kashmir, given security and opportunity, choose prosperity over violence. The challenge now is to ensure that terror does not succeed in turning back the clock on hard-won progress. The response must go beyond security measures; it requires a renewed commitment to economic development, job creation, and the protection of the livelihoods that are Kashmir’s best hope for lasting peace.