Impact of Azad Jammu and Kashmir’s Geopolitical Factors on the Economy

https://doi.org/10.55966/assaj.2025.4.1.090

Abstract

The complex relationship between Azad Jammu and Kashmir's (AJK) economic progress and geopolitical instability is examined in this extensive study.  It explores the negative effects of protracted political instability, border tensions, and administrative uncertainty on several AJK economic sectors.  Important topics include the financial repercussions of putting defense spending ahead of development, the interruption of trade and tourism brought on by military escalations, and the deterrent of foreign direct investment owing to perceived security threats.  The paper also explores the implications of administrative reorganization on business confidence and the intricacies of AJK's semi-autonomous status, which impedes the implementation of coherent policies.  It also emphasizes how susceptible key industries—like tourism, agriculture, and energy infrastructure—are to disruptions caused by both natural and artificial factors.  To harness AJK's economic potential and guarantee long-term resilience, the study emphasizes the critical need for institutional reform, regional stability, and governance clarity by combining insights from institutional reports, empirical research, and regional development programs.

Keywords: Azad Jammu and Kashmir, Geopolitical Instability, Foreign Direct Investment, Cross-Border Trade, Political Unrest, Security Issues, Economic Development, Infrastructure Investment, Tourism Vulnerability, Administrative Governance, Conflict Zones, Human Capital, Financial Systems, Climate Impact, Resource Management