Homeland Security

Kashmiri Shops in Tourists Spots - Is there More than What Meets the Eye?
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Issue Net Edition | Date : 10 Oct , 2016

While all suspect tax evasion and money laundering of corruption or crime proceeds merit investigation, the curious case of Kashmir shops that pay rent in excess of market rates but do not attract customers raises the additional dimension of insurgency and terror financing.

During a 2012 visit to Nainital, one was surprised to see many Kashmiri shops on the Mall Road. All through a three day stay, we walked by the Mall at various times of the day but rarely found a customer in most of the shops. It was tourist season and the products on display were likable, so the empty shops were surprising.

This shop, too, gets very few customers. It had about eight sales persons. Being a qualified accountant, the question that came to mind immediately was its financial viability!

That got one curious! On day three, I spoke to a few locals who still have shops on the Mall. They said Kashmiris paid rents that were much higher than the going rate, about 1.4 times. Therefore, locals were more than happy to lease their shops to them.

The next question, how are shop owners making money when rent is so high and few customers visit?  A local said this was something they were unable to fathom either. He shared an unintended effect – because the monthly rent, in absolute terms, was high, many landlords developed bad habits.

Fast forward to 2016. Close to the Maratha Palace at Thanjavur, Tamil Nadu, is a Kashmiri shop. One walked through the shop’s three levels and admired the range and design of products. Wanting to compliment the owner, the writer walked up to the cash counter and during the conversation, learnt that the owners were from Kashmir. This shop, too, gets very few customers. It had about eight sales persons. Being a qualified accountant, the question that came to mind immediately was its financial viability!

Also in 2016, the writer saw a couple of Kashmiri shops close to the entrance of Meenakshi Temple, Madurai. They were similar to the Thanjavur shop – excellent products spread over two or three levels, but no customers!

Unlike other shops in the State, the owners of Kashmiri shops did not permit the author to click pictures of their products although the intent expressed was to promote the shop on social media.

This got one even more curious. In Delhi and Mumbai, one has seen Kashmiri shops thrive, but in Nainital, Thanjavur and now Madurai, the opposite was true. A long-time resident of Auroville, Pondicherry, expressed similar sentiments with respect to Kashmiri shops there.

The question arose – did they not ask where the money was moved to, had they informed the local police? Without replying explicitly to the question, he said that once the money moved out of the State, it was outside the jurisdiction of the local police. Matter closed.

In August 2016 (August 15 weekend), we were at the Mall road in Manali. Here, too, the maximum number of shops were run by Kashmiris. During a four day stay, observed that only a few attracted customers.

Again one spoke to some local shop owners and found a story similar to that of Nainital. The rent paid by Kashmiris was much higher than market rates, so locals happily leased their shops to them.

This time I decided to dig a bit deeper. One spoke to some locals in the market and then a prominent local shop owner, on the condition of anonymity, said, ‘We had the same questions as you. So informally approached local banks to ascertain the modus operandi. We were told that most shop-owners deposited Rs 30-40,000 every morning in the bank. Before the end of banking hours that day the money was moved out of the account’.

The question arose – did they not ask where the money was moved to, had they informed the local police? Without replying explicitly to the question, he said that once the money moved out of the State, it was outside the jurisdiction of the local police. Matter closed.

Notwithstanding the fact that the author does not have possess hard evidence to prove the above bank transfers, the fact that these shops pay rents in excess of market rates and attract few customers raises questions!

According to the norms for high value transactions, when cash deposits in one or more accounts of a person exceed Rs 10 lakhs or more in a financial year, banks are supposed to report all such transactions to the Income-Tax authorities. According to this report in the Business Line, “One of the stringent recommendations from SIT on curbing generation of black money in India was putting a cap on huge cash transactions as these mostly take place in illegal activities.”

…the curious case of Kashmir shops that pay rent in excess of market rates but do not attract customers raises the additional dimension of insurgency and terror financing.

A senior Chartered Accountant construed these transactions as, ‘The deposits in the bank are supposed to be sales but could just be the cash requiring laundering. The withdrawals are supposed to be purchases/expenses, but might reach the banks of the people who gave the cash for laundering.’

One wonders how this activity is structured to avoid any implications under VAT and Income-tax.

While all suspect tax evasion and money laundering of corruption or crime proceeds merit investigation, the curious case of Kashmir shops that pay rent in excess of market rates but do not attract customers raises the additional dimension of insurgency and terror financing. This certainly merits a thorough probe.

It is not the author’s intention to paint all Kashmiri shop owners in tourist locations with the same brush. During a recent visit to Leh one saw many shops doing thriving business. The author has the highest regard for the entrepreneurial spirit of Kashmiri businessmen and apologises if sentiments are inadvertently hurt.

But the observation made at certain places suggests that something is clearly amiss, and merits an impartial investigation.

Why can’t the Central and State Intelligence Agencies, along with the Ministry of Finance, unravel the mystery of these shops which pay hefty rents but attract few customers?

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The views expressed are of the author and do not necessarily represent the opinions or policies of the Indian Defence Review.

About the Author

Sanjeev Nayyar

is an independent columnist. He tweets @sanjeev1927

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14 thoughts on “Kashmiri Shops in Tourists Spots – Is there More than What Meets the Eye?

  1. I observed a curious story sometime back. I have no hard data to support it, but was told by people who know of Sanjeev Nayyar. They say he secretly sleeps with a Koran under his pillow and also during the day harasses the female maids who work on his house. Additionally, some have said that he allegedly likes to fondle unknown women in public. I hv no proof of that – but maybe someone should investigate…

  2. I am sure, as a responsible journalist, the contents have been shared with DGP of states and MHA. In the present era, people tweet directly to Hon’ble PM, HM, FM et al for all kinds of issues. Why not this, if not already done? The contents merit looking into this aspect with an open and inquisitive mindset without any biases

  3. When so much is known about these shops, why is no investigation not being done? It is time that the entire network of funds flkow ultimately fuelling the anti-Indian leaders in Kashgmir and thence to the stone throwers, etc., is thoroughly investigated.
    What ar the authorities waiting for?

  4. Continuing further the inside story of the Kashmiri Shop-Keepers from my last post, I bring realities on the Kashmiri Shops.

    The Commissions are paid to the Travel Agent organizing or handling the Foreign Tourist Group, Kashmiri Shops BID for the groups to be brought to their Shops for Shopping, The Foreign Tour Leader, The Local Tour Leader and the Driver are all involved in collecting their share of commissions from these Kashmiri Shops.

    Again, the Drivers and the Tour Guides are persuaded to bring Foreign Tourists to their Shops. For this, there is an ENTRY FEE being given to both the Driver and the Tour Guide. It ranges from Rs. 500 to a Driver and to a Tour Guide Rs. 1,000. This money is being given as a BAKSHISH for bring the Foreign Tourists.

    Whether these people BUY or NOT, the Drivers and the Guides get their ENTRY FEE. This money I would call it as MONEY FOR DRINKS FOR THE EVENING !

    There is also extensive cheating taking place. They show a different product and ship or pack a different product, a look-alike. So, the Foreigner is cheated. Besides, they say that SHIPPING TOO is FREE, but on arrival of the Parcel, the Shipping Charges too, are collected. The foreigner would not hesitate to pay, as he has either paid the FULL amount or made PART PAYMENTS for his purchase.

    If you go deep down Southern India, TN, specially, Kerala, Thekkady, Kumarakom, Alleppy, close to the Boat Jetties are a lot of Kashmiri Shops operating. They are mushrooming like anything.

    One Kashmiri boy who works as a ROUNDER, a Marketing Guy of a particular shop said how long would this Demonitisation last long ? He says that MODI has destroyed everything ! They have all become paupers !

    The greedy travel agents are SITA, LPG-LE PASSAGE, etc. who quote less quotes for getting their Foreign Tourist Business. They in turn get big chunks of money from Kashmiri Shops depriving others.

    Please introspect whether it’s worth taking Foreign Tourists to Kashmiri Shops.

  5. Let me tell you that these Kashmiri Shops pay a very high percentage of Commission on Sales for bringing a customer. Car Drivers, Tour Guides, Touts, Lapkas [Un-licensed Tour Guides without any credentials and proper identity] bring Foreign Customers to these shops. Besides this, there is extensive marketing net-work done by these Shop Keepers with the Trip Organizers, Travel Agents. They would catch hold of the Tour Manager of the Travel Co or the Chief of the Tour Co who is sending the group to different destinations, instructing their staff and the Tour Guides to take them only to certain Kashmiri Shops. Even Travel Agents too, get commissions on the purchase of products in the Kashmiri Shop. So, the Tour Guides are forced to bring these foreign tourists to their Shops. Failing, their Guide Bill payments would not be made, or delayed un-necessarily. However be the Tour Guide as an Excellent Person, would not matter to the Agents. All that the Travel Agents want is their share of their Commission on the Sales of products in the Kashmiri Shop.

    The Commission on the sale proceeds would be shared according to percentages with the Tour Guide, the Driver as well the Travel Agent. Besides this, the Foreign Tour Leader Accompanying the group too, would demand HIS share of Commission on the Purchases.

    So there is a big net work going on right from the main Travel Agent based in Delhi who is responsible for bringing the Foreign Group to India, later, sub-contracts or advises his branches to allow only CERTAIN Kashmiri Shop who pay them good Commissions.

    In North India, when a big group of Foreign Tourists come, the Travel Agent asks the Kashmiri Shop Owners about their arrivals. There is a BID on these arrivals by the Kashmiri Shop Owners. So, literally, the Travel Agents are bought off. There is no escape.

    If at all, the Tour Guide refuses, that would be the last tour for him No more chunks of Tour Assignments would be given. I will continue further.

  6. If there is even a hint of an investigation into these ‘businesses’, NDTV and it’s ilk will be the first ones to protest and demand an end to ‘harassment’. Their tentacles are deep in every part of society and a comprehensive solution is needed.

  7. Yes indeed!
    After reading your article my mind was jostled by the very same thought as to how a similar handicrafts and curio shop run by Kashmiris was doing business in the far off town of Thiruvannamalai in remote South Bharat.
    Something bizarre is happening.

    This is on very similar lines to the numerous Night shops being run by Pakis who have been given refugee status in Western Europe.
    The shops are stocked with alcohol(taboo for the truly faithful adherents of Islam), cigarettes and some food items but there is hardly any business.
    Some years ago investigations revealed certain nefarious activities going on aling with hawala money transactions and also human trafficking.

    We in Bharat definitely need to alert our Secret Service agencies to find out as to the goings on behind the setting up and running of such ‘innicent’ shops.

    Things are not as innocent as they seem to be!

  8. Everyone is aware of loss making side businesses set up just to cover up the actual illegal cash trades going on. How much of policing is still falling short. To the common man, every one from top to bottom seems to be involved in covering up such shams.

  9. Excellent. You can see many Kashmiri owned shops in many places in Kerala also where all kinds of hawala deals happen and very poor policing in the form of investigation into such transactions as politicians get involved in most cases. Its surprising that central agencies have not yet taken up this issue to piece together the missing dots..

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