Why Did Narendra Modi Crack Down in Kashmir?

Scrapping the province's autonomy is a ploy to distract from India's cratering economy.

India has been described as an enigma wrapped in a riddle shrouded in mystery. But last Thursday, on the 73rd anniversary of its independence from British rule, it also became a monumental irony: Even as Indians celebrated the overthrow of colonial rule, the Indian army had turned the Himalayan state of Jammu and Kashmir into an open-air prison, where seven million residents were being held under curfew and banned from calling, tweeting, publishing—much less protesting. Their state legislature had been disbanded, their leaders were under house arrest, and the constitutional provisions granting them a measure of autonomy from New Delhi had been suspended.

Indian Prime Minister Narendra Modi, who engineered all this without any forewarning 10 days ago, is claiming that "fully integrating" (read: forcibly annexing) this ravaged state into broader India will turn it into a mecca of prosperity whose herbal products will find global markets and where tourists will once again roam. But there is every reason to suspect that Modi's Kashmir stunt is meant to distract from the fact that instead of delivering growth and "acche din"—good times—to India as he had promised six years ago, he is presiding over a cratering economy.

Modi likes to surprise. But unlike his last big surprise, when he scrapped 80 percent of the national currency one evening three years ago as part of his so-called demonetization effort, his Kashmir move is wildly popular.

His Hindu nationalist supporters are cheering it because they have long dreamed of extending their religious dominion over this predominantly Muslim area. The Indian Parliament rubber-stamped Modi's request to scrap Article 370, which had handed Kashmir special status to have its own constitution and flag, and Article 35A, which restricted the rights of noncitizens to own land (a problematic constitutional arrangement, but one that India offers to a half-dozen other states). Within hours, these nationalists started jubilantly floating maps of India draped in their trademark saffron turban audaciously perched on Kashmir. They didn't even bother masking their true intention by using the tri-color Indian flag.

But even Indians who aren't militant Hindus are foursquare behind Modi. Many see Kashmir with its snow-peaked mountains and lush valleys as India's crown jewel. And some blame its "special status" for allowing Pakistan to make inroads into it.

Pakistan has always resented that even though Kashmir has a large Muslim population, the British did not hand it this coveted bit of land when they left in 1947. Rather, they let the Hindu prince who ruled Kashmir at the time make an alliance with India. Since then, Pakistan has waged four wars, dispatched foreign jihadis, and funded a separatist insurgency in the Kashmiri valley to undermine India's control.

Modi claims that dismissing Kashmir's corrupt state government and replacing it with a strong central hand will make it easier to keep Pakistan at bay, root out insurgency, and restore law and order in the state. At the same time, ending restrictions on Indians who wish to settle or buy property will reopen Kashmir for business and investment.

It's a nice vision—except that local Muslims aren't buying it, which is why Modi had to mobilize 35,000 additional soldiers to put them in lockdown ahead of his announcement lest they protest and riot.

Why are Kashmiris so skeptical? For starters, as far as they are concerned, opening up the state won't bring development as much as an influx of Hindus, diluting their presence at a time when Hindu militancy is on the rise, which could worsen the security situation in the state.

Moreover, it's not like central rule has never been tried in Kashmir. It has. Many times. Indeed, the Kashmiri insurgency originally broke out in the late 1980s precisely because the ruling Congress Party dismissed a popularly elected state government and installed a stooge.

Modi wants everyone to believe the Congress Party failed in Kashmir because it was corrupt and didn't care about the country's greater good whereas he is squeaky-clean and driven by national interest. But what he lacks in corruption he makes up in ideological aggression. He doesn't care about local Kashmiris, which is why there is reason to fear that his rule of brute force will escalate.

Indeed, why did Modi pick this moment to do something so radical? Violence in Kashmir had been trending downwards for the last year, after all. The main reason, besides President Donald Trump's alarming offer to mediate a settlement, is that he wanted a distraction from India's mounting economic woes.

India's GDP growth dropped from over 8 percent to 5.8 percent over the last year, and it is widely expected to dip further. Just as ominous has been the crash in consumer demand. India's usual problem has been an insufficient supply to meet its voracious appetite for vehicles, cell phones, and other similar goods. But sales figures for all consumer goods have posted a precipitous decline, slamming businesses that are dramatically scaling back investments.

All of this is, to a large extent, the result of Modi's demonetization blunder, which wiped out India's farmers and the self-employed. Meanwhile, India's exports have plummeted. This is partly due to the global trade war between the U.S. and China. But the far bigger reason, notes Swaminathan Aiyar in The Economic Times, is that Indian exports have failed to maintain their international competitiveness due to high labor and land acquisition costs and a 42 percent effective corporate tax rate.

Reversing all this would mean painstaking and painful economic reforms that would require Modi to stand up to a lot of powerful constituencies, including his own party. It is far more politically expedient to take over Kashmir.

But if Modi can't deliver "acche din" to greater India after six years of rule, there is little reason to believe he can do so in a troubled and traumatized region like Kashmir. Modi's happy spin notwithstanding, the fact is that authoritarian leaders are better at flexing their muscles and taking land than getting their hands dirty building economies.

Independence is just another word for them.

A version of this column originally appeared in The Week.