After the bifurcation of the erstwhile state of Jammu and Kashmir into two Union Territories through the Jammu and Kashmir Reorganisation Act, 2019, the Union Territory of J&K is required to pay Rs 2,504.46 crore to the Union Territory of Ladakh.

On Thursday, the Union Territory government informed the that liabilities amounting to Rs 2,504.46 crore from the erstwhile state of Jammu and Kashmir are to be transferred to the newly created Union Territory of Ladakh.

In a written reply to a question, MLA Lolab Qaiser Jamsheed Lone, Minister In-charge of Finance, Omar Abdullah, disclosed that financial liabilities amounting to Rs 2,504.46 crore would be transferred to Ladakh.

"As regards the apportionment of public debt, the distribution of assets and liabilities is to be carried out as per notification SO-329 of GAD, dated 30/10/2020," the Chief Minister said.

He added that most of the recommendations regarding the apportionment of assets and liabilities between J&K and Ladakh have already been implemented.

The Minister further informed the House that the matter has been taken up with the Ladakh Union Territory administration and the Ministry of Home Affairs.

Three-Member Committee Formed to Oversee Distribution of Assets and Liabilities

Following the reorganisation of Jammu and Kashmir, the Ministry of Home Affairs set up an advisory committee in September 2019 to oversee the distribution of assets and liabilities between J&K and Ladakh.

The advisory committee, headed by former Defence Secretary Sanjay Mitra, includes retired IAS officer Arun Goyal and retired Indian Civil Accounts Service (ICAS) officer Giriraj Prasad.

"In exercise of the powers conferred by Section 84 and Section 85 of the Jammu and Kashmir Reorganisation Act, 2019, the central government hereby constitutes the advisory committee," the Home Ministry notification stated.

As per Section 84 of the Act, the assets and liabilities of the erstwhile state of Jammu and Kashmir must be apportioned between the Union Territories of Jammu and Kashmir and Ladakh.

On August 5, 2019, the Centre announced the abrogation of the special status granted to Jammu and Kashmir under Article 370 and the bifurcation of the state into two Union Territories.

The apportionment of the assets and liabilities of the erstwhile state of shall be subject to the recommendations of a committee constituted by the central government.

According to Section 85 of the Act, the central government, by order, can establish one or more advisory committees to oversee the apportionment of assets, rights, and liabilities of companies and corporations constituted for the erstwhile state of Jammu and Kashmir between the two Union Territories.