SDG 8: Decent Work & Economic Growth | SDG 12: Responsible Consumption & Production
Institutions: Ministry of Finance | Ministry of Commerce & Industry | Union Territory of J&K
On 03 October 2025, the Government of India reduced the GST rate from 12 % to 5 % across key sectors in Jammu & Kashmir (J&K) - including handicrafts, GI-tagged heritage products, agriculture, tourism services, and packaging.
The move is expected to enhance competitiveness of Pashmina shawls, Basohli paintings, Dogra cheese, walnut & almond exports, and the packaging industry - with J&K contributing over 91 % of India’s almond output and handicrafts employing more than 3.5 lakh people.
Tourism gets a boost too: stays up to ₹7,500 will now attract only 5 % GST, down from 12 %, potentially encouraging longer stays and higher occupancy, thus supporting ~70,000 jobs in the domain.
This reduction aligns with J&K’s push for economic revival post-reorganisation, leveraging local heritage & agritourism assets. For national policy, it signals use of GST levers to spur growth in lagging regions and support creative/heritage economies.
What is GST? → The Goods and Services Tax is India’s unified indirect tax on goods and services, replacing multiple state and central levies. It matters because changes in GST rates directly affect pricing, demand, competitiveness, and revenue flows.
Relevant Question for Policy Stakeholders: With GST lowered so steeply in J&K, how can state and central agencies coordinate to monitor the actual benefit passing to artisans, prevent tax leakage, and ensure increased demand leads to sustainable growth not just short-term gains?
Follow the full news here: https://www.pib.gov.in/PressReleasePage.aspx?PRID=2174573