Many in Indian-controlled Kashmir plan to vote this time to deny Modi total control

SRINAGAR, India (AP) — For decades, boycotting elections in Indian-controlled Kashmir was a sign of protest against Indian rule.

That may change on Wednesday, when many residents of the Muslim-majority region say they’re willing to use their vote in a local election to deny Prime Minister Narendra Modi’s party the power to form an administration in the disputed region.

The vote is the first in a decade, and the first since Modi’s Hindu nationalist government in 2019 scrapped the region’s special status and downgraded the former state to a federally governed territory. The move — which largely resonated in India and among Modi supporters — was mostly opposed in Kashmir as an assault on its identity and autonomy.

“Boycotts will not work in this election,” said Abdul Rashid, a resident in southern Kashmir’s Shangus village. “There is a desperate need to end the onslaught of changes coming from there (India).”

The election will allow Kashmir to have its own truncated government and a local assembly, instead of remaining under New Delhi’s direct rule. The region’s last assembly election was held in 2014, after which Modi’s Bharatiya Janata Party for the first time ruled in a coalition with the local Peoples Democratic Party.

But the government collapsed in 2018, after BJP withdrew from the coalition. Polls in the past have been marked with violence, boycotts and vote-rigging, even though India called them a victory over separatism.

This time, New Delhi says the polls are ushering in democracy after more than three decades of strife. However, many locals see the vote as an opportunity not only to elect their own representatives but also to register their protest against the 2019 changes.

Polling will be held in three phases. The second and third phases are scheduled for Sept. 25 and Oct. 1. Votes will be counted on Oct. 8, with results expected that day.

Kashmir is divided between nuclear-armed rivals India and Pakistan. Since 1947, the neighbors have fought two wars over its control, after British rule of the subcontinent ended with the creation of the two countries. Both claim the Himalayan territory in its entirety.

In 2019, the Indian-controlled part of the region was divided into two territories, Ladakh and Jammu-Kashmir, ruled directly by New Delhi. The region has been on edge since it lost its flag, criminal code, constitution and inherited protections on land and jobs.

Multiple pro-India Kashmiri parties, many of whose leaders were among thousands jailed in 2019, are contesting the election, promising to reverse those changes. Some lower-rung separatist leaders, who in the past dismissed polls as illegitimate exercises under military occupation, are also running for office as independent candidates.

India’s main opposition Congress party, which favors restoration of the region’s statehood, has formed an alliance with the National Conference, the region’s largest party. Modi’s BJP has a strong political base in Hindu-dominated areas of Jammu that largely favor the 2019 changes but is weak in the Kashmir Valley, the heartland of anti-India rebellion.

“Our main concern is governance through local representatives. It will be good for us if the BJP forms the government here as it’s already in power at the center,” said Chuni Lal, a shopkeeper in Jammu city.

The vote will see a limited transition of power from New Delhi to the local assembly, with a chief minister at the top heading a council of ministers. But Kashmir will continue to be a “Union Territory” — a region directly controlled by the federal government — with India’s Parliament remaining its main legislator.

The elected government will have partial control over areas like education, culture and taxation but not over the police. Kashmir’s statehood must be restored for the new government to have powers similar to other states in India. However, it will not have the special powers it enjoyed before the 2019 changes.

Last year, India’s Supreme Court endorsed the government’s 2019 changes but ordered New Delhi to conduct local polls by the end of September and restore Kashmir’s statehood. Modi’s government has promised to restore statehood after the polls but has not specified a timeline.

Elections in Indian-held Kashmir are a sensitive issue. Many believe they have been rigged multiple times in favor of local politicians who subsequently became India’s regional enforcers, used to incrementally dilute laws that offered Kashmir a special status and legitimize New Delhi’s militaristic policies.

In the mid-1980s, the region’s dissident political groups emerged as a formidable force against Kashmir’s pro-India political elite but lost the 1987 election widely believed to have been rigged. A public backlash followed, with some young activists taking up arms and demanding a united Kashmir, either under Pakistani rule or independent of both.

India insists the insurgency is Pakistan-sponsored terrorism, a charge Islamabad denies. Tens of thousands of people have been killed in the fighting, which most Kashmiri Muslims consider a legitimate freedom struggle.

Noor Ahmed Baba, a political scientist, said the outcome of the polls “is not going to change the dynamics of the Kashmir dispute” since it will end with a largely powerless legislature, but will be crucial for optics.

“If local parties win, it is going to put some pressure on the central government and perhaps delegitimize from a democratic perspective what has been done to Kashmir. But a BJP win can allow the party to consolidate and validate 2019 changes in the local legislature,” Baba said.

India’s ruling BJP is not officially aligned with any local party, but many politicians believe it is tacitly supporting some parties and independent candidates who privately agree with it.

The National Conference party says Modi’s BJP is trying to manipulate the election through independents. “Their (BJP’s) concerted effort is to divide the vote in Kashmir,” said Tanvir Sadiq, a candidate from the National Conference.

The BJP’s national secretary, meanwhile, says his party’s former ally, the Peoples Democratic Party, and the National Conference are being supported by former militants. Ram Madhav said at a recent rally that they want to return the region to its “trouble-filled days.”

For residents whose civil liberties have been curbed, the election is also a chance to choose representatives they hope will address their main issues.

Many say that while the election won’t solve the dispute over Kashmir, it will give them a rare window to express their frustration with Indian control.

“We need some relief and end of bureaucratic rule here,” said Rafiq Ahmed, a taxi driver in the region’s main city of Srinagar.

Bharatiya Janata Party (BJP) party workers attend a rally, ahead of Jammu and Kashmir Assembly elections in Jammu, India, Saturday Sep.7, 2024.(AP Photo/Channi Anand, File)

Former union minster and star campaigner of BJP Anurag Thakur and state in charge Ram Madhav wave to supporters during a campaign rally, after party candidates filed the nomination papers for the upcoming Jammu and Kashmir Assembly elections at Nagrota outskirts of Jammu, India, Thursday, Sep.12, 2024.(AP Photo/Channi Anand, File)

Supporters of India's opposition Congress party, wave during an election rally at Dooru some 78 kilometers (49 miles) south of Srinagar, Indian controlled Kashmir,Wednesday, Sept. 4, 2024. (AP Photo/Mukhtar Khan, File)

Supporters of Awami Ittehad Party (AIP) leader Sheikh Abdul Rashid, also known as Engineer Rashid, attend a public rally at Baramulla, some 55 kilometers (34 miles) north of Srinagar, Indian controlled Kashmir, Sept. 12, 2024. (AP Photo/Mukhtar Khan, File)

Awami Ittehad Party (AIP) leader Sheikh Abdul Rashid, also known as Engineer Rashid, speaks during a public rally at Baramulla, some 55 kilometers (34 miles) north of Srinagar, Indian controlled Kashmir, Sept. 12, 2024. (AP Photo/Mukhtar Khan, File)

Policemen stop supporters of National Conference Party from accompanying their candidate during the filing of nomination papers for the upcoming Jammu and Kashmir Assembly elections in Jammu, India, Sept.10, 2024. (AP Photo/Channi Anand, File)

Supporters listen as India's opposition Congress party leader Rahul Gandhi, unseen, speaks during an election rally at Dooru some 78 kilometers south of Srinagar, Indian controlled Kashmir, Wednesday, Sept. 4, 2024. (AP Photo/Mukhtar Khan, FILE)

Supporters of India's opposition Congress party leader Rahul Gandhi, shout slogans during an election rally at Dooru, some 78 kilometers south of Srinagar, Indian controlled Kashmir, Sept. 4, 2024. (AP Photo/Mukhtar Khan, File)

People watch from a window during a road show of Peoples Democratic Party (PDP) candidate Arif Laigroo, in Srinagar, Indian-controlled Kashmir Sunday, Sept. 15, 2024. (AP Photo/Mukhtar Khan, File)

National Conference (NC) President Farooq Abdullah, center, Peoples Democratic Party (PDP) leader Mehbooba Mufti, second right, and other leaders sit during an all parties meeting on restoration of the special status that was stripped last year from Indian-administered Kashmir, in Srinagar, India. (AP Photo/Mukhtar Khan, File)

A child looks on as Indian policemen frisk Kashmiri pedestrians during a surprise security check in Srinagar, Indian controlled Kashmir, Monday, Jan. 9, 2023. (AP Photo/Mukhtar Khan, File)

Indian security forces walk past Indian flags and flags of India's ruling Bharatiya Janata Party (BJP) as a motorcycle rally by BJP youth wing to the Kargil War Memorial passes through Srinagar, Indian controlled Kashmir, Monday, July 25, 2022. (AP Photo/Mukhtar Khan, File)

Kashmiris shout slogans during a protest after Friday prayers against the abrogation of article 370, on the outskirts of Srinagar, Indian controlled Kashmir, Friday, Oct. 4, 2019.(AP Photo/ Dar Yasin, File)

A masked protester throws stone at Indian security forces during a protest after Eid prayers in Srinagar, Indian controlled Kashmir, Saturday, June 16, 2018. (AP Photo/Dar Yasin, File)

Kashmiris sit outside closed shops painted with graffiti during a curfew in central Srinagar, India, Thursday, Sept. 16, 2010. (AP Photo/Dar Yasin, File)

NEW YORK (AP) — Wall Street wavered near its records after the Federal Reserve kicked off its efforts to prevent a recession with a bigger-than-usual cut to interest rates. The S&P 500 slipped 0.3% Wednesday after a day of bobbing higher and lower. The Dow Jones Industrial Average fell 0.2%, and the Nasdaq composite gave back 0.3%. Because the Fed’s first cut to interest rates in four years was so well telegraphed, and markets had already moved so much in anticipation of it, Wall Street’s reactions weren’t that big despite the momentous move by the Fed. Treasury yields edged higher.

THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.

NEW YORK (AP) — Wall Street is holding near its records on Wednesday after the Federal Reserve kicked off its efforts to prevent a recession with a bigger-than-usual cut to interest rates.

The S&P 500 was virtually flat in late trading and 0.6% below its all-time high set in July. The Dow Jones Industrial Average was down 31 points, or 0.1%, and close to its record set on Monday. The Nasdaq composite was 0.2% higher, as of 3:35 p.m. Eastern time.

The momentous move by the Fed helps financial markets in two big ways. It eases the brakes off the economy, which has been slowing under the weight of higher rates, and it gives a boost to prices for all kinds of investments. Besides stocks, gold and bond prices had already rallied in recent months on expectations that cuts to rates were coming.

Because the move was so well telegraphed, and markets had already climbed so much in anticipation of it, Wall Street’s reactions were relatively muted despite the Fed’s historic action. It marked the first cut to the federal funds rate in over four years, and it closed the door on a stretch where the Fed kept the rate at a two-decade high to slow the economy enough to stifle the worst inflation in generations.

Now that inflation has eased significantly from its peak two summers ago and appears to be heading toward 2%, the Fed says it it can turn more of its attention toward protecting the slowing job market and overall economy.

“The time to support the labor market is when it’s strong and not when you begin to see the layoffs," Fed Chair Jerome Powell said. "That’s the situation we’re in.”

The only question is how much the Fed will ultimately cut rates by to do so, which can prove to be a tricky balance. Lowering rates would help the economy by making it easier for U.S. businesses and households to borrow. But it could also offer more fuel for inflation.

The Fed released forecasts Wednesday that said its median official expects to cut the federal funds rate by another half of a percentage point through the end of the year. That could mean a traditional-sized cut of a quarter of a percentage point at each of its two remaining meetings scheduled for 2024.

After that, the median Fed official is projecting another full percentage point of cuts during 2025.

Some critics say the Federal Reserve may be moving too late to protect the economy after having kept rates too high for too long.

“When the Fed is behind the curve, it sometimes takes a big move to catch up to where they should have been all along,” said Brian Jacobsen, chief economist at Annex Wealth Management.

“We don’t think we’re behind,” Powell said in a press conference following the Fed's announcement. “We think this is timely. But I think you can take this as a sign of our commitment not to get behind," pointing to Wednesday's hefty cut of half a percentage point. Powell called it a “good strong start to this.”

Other critics, meanwhile, are saying the Fed will need to be careful about cutting rates too much because of the possibility that inflation will remain stubbornly higher than it's been in recent decades.

Powell repeated several times that the Fed does not feel “a rush to get this done” and will make its decisions on interest rates at each successive meeting, depending on what incoming data say.

“We’ll move as fast or as slow as we think is appropriate in real time,” he said. For now, he said, "the U.S. economy is in a good place, and our decision today is designed to keep it there.”

Treasury yields squiggled down and up immediately after the Fed announced its cut and published its projections.

The 10-year Treasury yield eventually rose to 3.70% from 3.65% late Tuesday. The two-year yield, which more closely follows expectations for Fed action, edged up to 3.62% from 3.60% late Tuesday.

On Wall Street, stocks of oil-and-gas producers and other companies whose profits are most closely tied to the strength of the economy helped lead the way. Utilities and other dividend-paying stocks that tend to hold up better during economic downturns, meanwhile, lagged behind the market.

That could be a signal that Wall Street sees lower odds of painful recession following the Fed's cut, according to Sameer Samana, senior global market strategist at Wells Fargo Investment Institute.

Intuitive Machines soared 40% after NASA awarded it with a contract worth up to $4.82 billion for communication and navigation services the space agency will use to establish a long-term presence on the moon.

Trading in Tupperware Brands remained halted after the company filed for Chapter 11 bankruptcy protection. Its stock has been sinking, down to 51 cents, since a mini-revival early in the pandemic sent its stock above $30.

McGrath RentCorp., a company that rents and sells mobile office trailers, portable classrooms and other structures, fell 3.9% after it agreed to terminate its proposed buyout by WillScot following tough scrutiny of the deal from U.S. regulators.

In stock markets abroad, indexes were modestly lower in Europe after finishing higher in much of Asia.

The Bank of Japan and the Bank of England are also holding monetary policy meetings later this week. Neither central bank is expected to move on rates, though the language of what the officials say could be an indicator of later moves and still influence markets.

AP Business Writers Yuri Kageyama and Matt Ott contributed.

Specialist Genaro Saporito, foreground, works with traders at his post on the floor of the New York Stock Exchange, Wednesday, Sept. 18, 2024. (AP Photo/Richard Drew)

The news conference of Federal' Reserve Chair Jerome Powell appears on a screen as trader Neil Catania works on the floor of the New York Stock Exchange, Wednesday, Sept. 18, 2024. (AP Photo/Richard Drew)

Trader Michale Conlon, right, works on the floor of the New York Stock Exchange as Federal Reserve Chair Jerome Powell's news conference appears on a television screen behind him, Wednesday, Sept. 18, 2024. (AP Photo/Richard Drew)

Trader Edward Curran works on the floor of the New York Stock Exchange, Wednesday, Sept. 18, 2024. (AP Photo/Richard Drew)

Specialist John O'Hara works at his post on the floor of the New York Stock Exchange, Wednesday, Sept. 18, 2024. (AP Photo/Richard Drew)

Trader Leon Montana works on the floor of the New York Stock Exchange, Wednesday, Sept. 18, 2024. (AP Photo/Richard Drew)

Trader Aaron Ford works on the floor of the New York Stock Exchange, Wednesday, Sept. 18, 2024. (AP Photo/Richard Drew)

Trader Michael Capolino works on the floor of the New York Stock Exchange, Wednesday, Sept. 18, 2024. (AP Photo/Richard Drew)

A bus passes the Wall St. subway station on Wednesday, Sept. 18, 2024, in New York. (AP Photo/Peter Morgan)

The New York Stock Exchange, with a banner for American Eagle Outfitters, is shown on Tuesday, Sept. 17, 2024, in New York. (AP Photo/Peter Morgan)

A person stands near an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, Sept. 18, 2024, in Tokyo. (AP Photo/Eugene Hoshiko)

People stand near an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, Sept. 18, 2024, in Tokyo. (AP Photo/Eugene Hoshiko)

People stand in front of an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, Sept. 18, 2024, in Tokyo. (AP Photo/Eugene Hoshiko)

A person rides a bicycle in front of an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, Sept. 18, 2024, in Tokyo. (AP Photo/Eugene Hoshiko)