Time For Govt-Bank-Industry Coordination To Secure J&K’s Economy

The Federation of Chambers of Industries Kashmir (FCIK) has sought a moratorium on coercive bank actions under the SARFAESI Act. At a moment when the government is reviewing its industrial policy with the stated aim of revival and rehabilitation, aggressive asset seizure against MSMEs is a contradictory and self-defeating strategy that risks inflicting irreversible damage on the Union Territory’s fragile industrial base and shattering the confidence of its youth. The core of the issue is timing and approach. MSMEs in J&K are not willful defaulters but enterprises that have endured unparalleled shocks, which include decades of instability, floods, prolonged shutdowns, and the pandemic. A purely mechanical enforcement of recovery, especially one that targets residential property, does not protect public funds; it destroys the very capital, both financial and human, required for future repayment and growth. It extinguishes livelihoods, erodes the dignity of families, and sends a chilling message to aspiring entrepreneurs: that the system offers no safety net for failure, only punitive ruin. The government must heed this call for a pragmatic pause. An immediate, time-bound moratorium on such dispossessive actions is essential until a structured resolution framework is operational. This period must be used to swiftly finalise and implement the proposed One-Time Settlement (OTS) scheme and, more innovatively, to establish an Asset Reconstruction Company (ARC) mechanism. An ARC can professionally manage stressed assets, separating viable units for revival from non-viable ones for orderly closure, thus freeing banks from protracted litigation and offering entrepreneurs a dignified resolution. This is not about forgiving debt but about intelligent recovery that balances fiscal responsibility with economic revival. The government’s vision for a vibrant, job-creating industrial sector cannot be realised by dismantling its existing foundation. Coordination, not confrontation, between the administration, banks, and industry is the only path forward. A compassionate, calibrated response now can preserve livelihoods, restore entrepreneurial faith, and secure the future of J&K’s economy. The choice is between salvaging an ecosystem or presiding over its collapse.