Two years ago when private bank HDFC announced its plan to open a branch in Kashmir, many of South Asia's financial analysts blanched. No private financial institution was willing to risk investing in a conflict zone often rattled by bomb attacks.
'Many were scared to come to this dangerous place,' Zubair Iqbal, the assistant vice-president of HDFC Bank, said in his smart office in central Srinagar. 'We dared.'
That daring is today earning the bank rich dividends. The branch now has more than 8,000 accounts and has fetched business worth nearly 2.5 billion rupees (HK$451 million).
This year, the bank plans to open five more branches in the state, two in Baramullah and Pulwama, both districts rife with militants. HDFC hopes to cash in on a rich orchard-owning clientele that has long suffered the lack of a full-service bank.
Kashmir's woes, which have cost thousands of lives amid a 17-year insurgency, have failed to cripple the region's economy.
Kashmir's growth rate of 5.5 per cent lags well behind India's national rate of 9.2 per cent, but Indian statistics also claim that in the rural and urban areas, only 3.97 per cent and 1.98 per cent, respectively, of Kashmiris live below the poverty line. Nationwide, the figures are 27.09 per cent and 23.02 per cent.