Has Kashmir’s Appetite for Luxury Outpaced its Reality?
By Rafiq Dar
In Kashmir, there is an old saying that cuts to the bone of the valley’s current economic temper: “If one rides a horse, the other one climbs the wall.” It is a proverb about envy, about the desperate need to match a neighbor’s stride, even if it means defying gravity—or in today’s context, defying financial logic. This phrase no longer just paints a vivid picture; it serves as a warning siren for a society rapidly sliding into a debt trap of its own making. The situation in the region has graduated from concerning to critical, creating a fragile bubble where the burden of loans is beginning to eclipse actual earnings, leaving thousands of families one missed EMI away from struggle.
The paradox at the heart of this shift is stark. Islamic scholars and the region’s traditional ethos have long discouraged Riba (interest), viewing debt as a shackle to be avoided except in dire necessity. Yet, the data from the fiscal year 2024-25 tells a story of aggressive borrowing that defies this cultural conservatism. According to recent financial disclosures, Jammu and Kashmir Bank saw its gross advances grow by over 12 percent, but the devil is in the details of what is being financed. While industrial credit often struggles, consumer loans are skyrocketing. Housing loan portfolios have surged by nearly 20 percent year-on-year, and car loans have seen an even steeper rise of over 25 percent. We are no longer borrowing to survive; we are borrowing to perform.
This performance is most visible in the region’s architecture. The definition of a “necessity” has been stretched to breaking point. A modest single-story house, once the hallmark of a secure middle-class life, is now seen as a symbol of stagnation. In its place, three-story concrete behemoths are rising across Srinagar and Anantnag, often housing only four family members. These are not just homes; they are monuments to social validation, financed primarily through bank liabilities that will take decades to clear. The irony is palpable: families live in showpieces of affluence while privately navigating the crushing stress of repayment cycles. The walls are high, the gates are ornate, but the foundation is mortgaged.
This trend of preferring luxury over utility is perhaps most visible on our roads. A decade ago, a Maruti 800 or an Alto was a badge of mobility. Today, the roads are choked with high-end SUVs and sedans, many acquired through financing schemes that require little upfront capital but demand heavy monthly servitude. The logic of “genuine need”—a motorcycle for a commute, a compact car for a small family—has been cannibalized by the desire for status. When a young man earning a modest salary purchases a ₹1.6 lakh motorbike on EMI, or a family upgrades to a luxury vehicle they rarely drive, the economy of the household shifts from sustenance to display. We must ask: Where does luxury come into play when basic solvency is at stake?
This disconnect between private accumulation and public responsibility reached a flashpoint in August 2023, when Lieutenant Governor Manoj Sinha held a mirror to the society. His statement to the media was blunt and uncomfortable: “If Kashmiri people are building three-story bungalows, buying the latest iPhone with 5G data, and driving luxury cars, why can’t they pay their electricity bills?” The comment stung because it was rooted in truth. The government had found that while the consumption of high-end goods—iPhones, gadgets, appliances—was rising, the compliance for paying basic utility tariffs remained abysmal. It highlighted a civic dissonance where we aspire to a First World lifestyle on borrowed money while neglecting the basic civic duties that sustain the infrastructure we rely on.
The criticism the society has earned is not unfounded. The wedding industry, a multi-crore beast in Kashmir, consumes a frightening percentage of household savings and credit. The “demonstration effect”—where consumption is driven not by need but by the visible consumption of others—has turned cultural ceremonies into financial suicide missions. Families are taking personal loans at high interest rates to serve twenty-dish feasts, fearing social ostracization more than bankruptcy. This is not economic growth; it is economic anxiety masquerading as wealth.
If we look across the border at the Pakistani economy, the warning signs are written in bold letters. We see a nation that, despite ample resources, prioritized consumption and non-developmental expenditure over structural stability, eventually struggling to secure even the basic livelihoods of its citizens. While the geopolitical contexts differ, the economic principle remains the same: an economy fueled by debt-driven consumption rather than productivity is a ticking time bomb. If Kashmir does not curb its appetite for impulsive borrowing and luxury, the consequences could be severe. We are already seeing the early signs—a rise in stress-induced ailments among the youth and a quiet but growing number of loan defaults in the personal sector.
The prevailing loan culture suggests we have forgotten the difference between an asset and a liability. A house you cannot afford to maintain is a liability. A car that eats into your children’s education fund is a liability. A wedding that forces you to sell ancestral land is a tragedy. We are effectively stealing from our future to subsidize our present image.
Ultimately, the Lieutenant Governor’s remark serves as a stark reminder that while the aspiration for a better life is natural, it must be tethered to reality. True prosperity is not the ability to take a loan; it is the ability to sleep without the weight of one. The shift must happen now, from a culture of “climbing the wall” to unmatched heights of debt, back to a culture of riding the horse we can actually afford. If we fail to strike this balance, we risk walking into a future where we are trapped in a cycle of servitude, living in palaces we don’t own, driving cars we can’t fuel, and unable to meet the most basic obligations of a dignified life.
The views expressed in this article are solely those of the author and do not necessarily reflect the opinions or views of this newspaper. The author can be reached at [email protected]
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