Kashmir’s handicraft sector has recorded a remarkable resurgence in exports, with the April-June quarter (Q1 FY26) marking a historic high for handmade product shipments. According to the Department of Handicrafts and Handloom, Kashmir, exports touched ₹309.62 crore (US$ 35.87 million) in Q1 of FY26, showing a staggering rise from ₹126.90 crore (US$ 14.70 million) in the same quarter last year. This is the highest Q1 export figure recorded in the last four years, indicating a revival in global demand for Kashmir’s world-renowned artisanal products.

The figures demonstrate significant growth in the region’s craft-based exports, a sector vital not only for its cultural value but also for its socio-economic importance to thousands of local artisans and weavers. The department has projected FY26 full-year exports to exceed ₹1,500 crore (US$ 173.77 million), contingent on geopolitical stability and sustained market demand.

Key Products Leading the Surge

Kani shawls, Sozni-embroidered woolens, and hand-knotted carpets remain the top contributors to the export value. These GI-registered (Geographical Indication) products have been historically significant, not just culturally but economically, with strong appeal in international luxury markets. In addition to these, papier-mâché, crewels, chain-stitch items, and wood carvings have also made notable contributions, widening the product base of Kashmir’s export portfolio.

Year-on-Year Export Performance

In FY25, Kashmir had exported handmade goods worth ₹733.59 crore (US$ 84.98 million). However, global conflicts, disrupted supply chains, and inflationary pressures had limited growth. In contrast, Q1 FY26 shows a growth of over 144% YoY, indicating a robust recovery and improved global outreach of Kashmir’s craft goods.

Government Initiatives and Export Subsidy Scheme

The Government of Jammu & Kashmir, through its Department of Handicrafts and Handloom, has introduced several measures to incentivize exports and improve production quality. Among these is the Export Subsidy Scheme, which provides a 10% incentive on the total volume of GI-registered handloom/handicraft products exported, with a maximum reimbursement limit of ₹5 crore (US$ 579,240). To avail of this benefit, exporters must be registered with the department and comply with the scheme’s eligibility criteria.

This initiative is designed to encourage higher volumes of export, increase price competitiveness, and ensure financial sustainability for exporters. It is also aimed at motivating smaller artisans and exporters to formalize their operations and integrate with the global trade network.

Design Innovation and Skill Development

To support artisans in developing market-relevant products, the government has invested in design innovation infrastructure. The Design Studio at the Indian Institute of Carpet Technology and the Craft Development Institute’s prototyping unit are producing contemporary designs, prototypes, and packaging models. These are made available to exporters and craft cooperatives to help enhance the appeal and value proposition of Kashmir’s traditional crafts in premium international markets.

Exporters are being encouraged to adopt modern packaging, branding, and marketing tools, particularly those aimed at European, North American, Middle Eastern, and Japanese markets, where demand for authentic, sustainable, and artisanal products is high and growing.

Socio-Economic Impact on Artisan Communities

The export boom is likely to have a direct positive impact on the livelihoods of over 2 lakh artisans associated with Kashmir’s craft sector. Many families that rely solely on artisanal trades, such as weaving, embroidery, paper-making, and wood carving, are expected to benefit from increased demand, better margins, and more stable income opportunities.

Women, who form a significant portion of the artisan workforce, particularly in sectors like crewel embroidery and chain-stitch work, are also likely to benefit from this export momentum, contributing to greater rural employment and financial inclusion.

Emerging Global Markets and Diversification

The recent quarter has seen Kashmir’s crafts being exported to newer geographies, including Japan, Australia, and select Scandinavian nations, in addition to traditional buyers in Europe, Gulf countries, and North America. The expansion of India’s Free Trade Agreements (FTAs) is aiding in market penetration with reduced tariffs and improved logistics.

Exporters are also beginning to diversify product categories, introducing handloom-based home décor items, sustainable gift products, and luxury accessories, which have found favour among eco-conscious and ethically-driven international buyers.

Digital Promotion and E-Commerce Integration

Another factor boosting exports is the growing use of digital tools and online platforms. Many artisan clusters have been trained in basic digital marketing, and exporters have begun leveraging online B2B marketplaces, virtual trade fairs, and direct-to-consumer e-commerce channels.

The Ministry of Textiles, in collaboration with Invest India and IBEF, is also promoting Indian handicrafts, including Kashmiri GI-tagged products, through country-specific digital campaigns, helping to raise global awareness and demand.

Challenges and the Road Ahead

Despite the surge, the sector still faces several challenges, including:

• Dependence on volatile global markets.

• Supply chain disruptions due to conflict or climate-related risks.

• Rising raw material costs.

• Limited access to formal financing for smaller artisans.

To sustain and build on this momentum, experts recommend:

• Strengthening artisan cooperatives.

• Enhancing infrastructure for quality testing and certification.

• Scaling up digital literacy and e-commerce capacity among artisans.

• Improving customs facilitation and global branding efforts.

Conclusion

Kashmir’s performance in Q1 FY26 marks a turning point for its artisan economy. With exports crossing ₹300 crore, the region has reaffirmed its place as a global centre for premium handcrafted goods. Strategic policy support, along with market diversification, digital adoption, and design innovation, is positioning the sector for sustained long-term growth.

As global consumers increasingly seek authentic, sustainable, and culturally rooted products, Kashmir’s rich heritage of handmade crafts stands poised to capture the spotlight on the world stage.

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