Kashmir is missing out on a ‘demographic dividend’ and unable to cash in on its youthful population for lack of initiatives from a state government bogged down by a two-decade-old separatist insurgency.

Mercy Corps, a United States-based development agency, found 48 percent of youth in Kashmir unemployed, in a comprehensive survey, the results of which were published in August 2011.

According to the survey, Kashmir is experiencing a ‘youth bulge’ with about 70 percent of its 10 million-strong population under the age of 31.

The World Bank’s chief economist, Justin Yifu Lin, submits in his blog ‘Let’s Talk Development’ on Jan. 5 that the increase in the number of working age individuals can, if fully employed in productive activities, other things being equal, result in a youth bulge becoming a demographic dividend.

'However, if a large cohort of young people cannot find employment and earn satisfactory income, the youth bulge will become a demographic bomb, because a large mass of frustrated youth is likely to become a potential source of social and political instability,' Lin warns in the posting.

Signs of youth unrest are already visible in the Kashmir valley in several stone-throwing sprees lasting days and occasioning the imposition of curfews since 2008. Several hundred youth, including juveniles, are currently lodged in jails on charges of rioting that are not entirely unrelated to separatist militancy.

'These stone-throwing episodes are largely the result of frustration among Kashmiri youth from a sense of hopelessness and frustration regarding the future,' says Roshanara Malik, a schoolteacher and psychologist. 'The government needs to think of career counselling and placements seriously, rather than lock young people away.'

The Bank holds that most developing countries have a short window of opportunity to enact policies and promote investments that raise the human capital of young people while positioning them for greater economic productivity.

Citing official data, Mercy Corps said that the incidence of unemployment amongst youth in Kashmir has continued to rise since 1993. 'With more and more educated youth entering an already over-saturated job market each year, Kashmir faces a mounting challenge.'

One issue reflected in the survey is that government jobs continue to be prized in Kashmir, creating a mindset in which jobs in the private sector or entrepreneurship are less valued.

But Kashmir’s Chief Minister Omar Abdullah has made it clear that it is unrealistic to expect the government to provide more employment in a state already groaning under an annual wage bill worth 3.6 billion dollars.

'The preference for government jobs in a conflict zone, where investing in businesses is risky, is understandable. But this preference has resulted in high unemployment rates,' Shamas Imran, a researcher on social issues and teacher at Kashmir’s Central University, told IPS.

Imran and others say that if the government cannot provide jobs it should create conditions for the growth of entrepreneurship in Kashmir beyond traditional activities like tourism.

Several participants of a November 2011 youth gathering in Kashmir’s capital, the ‘Young Kashmir Leadership Meet’, told IPS that they would like to see the government encourage private sector investments aimed at generating jobs and incomes.

'We do need to give up this notion that government jobs alone are everything and rest is nothing. But this mindset can change only when employment opportunities are created in the private sector,' said Imtiyaz Lone, a participant in the meet.

Imran, however, said limited employment opportunities in government and the private sector were already beginning to push youth towards self-employment in such areas as floriculture.

Mumtaz Sheikh, 27, a post-graduate from Kashmir University, is happy growing flowers on his farm. 'After realising that a government job or even a private job is hard to find, I started exploring options of self-dependence,' Sheikh told IPS.

Nusrat Jahan, 37, a woman who graduated in computer applications, is another entrepreneur who has taken the floriculture route to self-employment. She has no regrets and now employs 20 people in her business supplying flowers to such clients as ‘Ferns N Petals’, India’s largest florist chain.

'Floriculture pays good dividends, giving an average farmer an additional income of around 2,000 dollars per season,' Harcharan Pal Singh, director of floriculture in Kashmir, told IPS.

When Alexander Mudragey, director of Wisdom Flowers, a major Russian importer, visited Kashmir last year, he put the potential of floriculture in the state at 100 million dollars a year, though this would call for initial investments.

Mudragey said the cost of flower production was much lower in Kashmir than elsewhere in the world, with climatic conditions favouring roses and tulips which were of better quality than those grown in major flower exporting countries like the Netherlands, Columbia, Ethiopia, China and Vietnam.

Entrepreneurs like Sheikh complain that Kashmir’s provincial government has done little to boost entrepreneurship in horticulture or other potentially income-generating activities.

'Unfortunately, the government has been slow in tapping such identified employment-generating sectors as commercial floriculture, fisheries and forest- and agriculture-based industries,' says Mohammad Ashraf, an independent researcher.

Ashraf’s views were in consonance with the findings of the Mercy Corps survey that said 'Kashmiri youth are highly resilient, educated and motivated, but currently lack the skills needed to compete in the 21st century.'

'Kashmir’s burgeoning youth population is an untapped asset and represents a potential opportunity for positive economic and social change. Large percentages of Kashmir’s youth are potential entrepreneurs,' the survey said.