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The handicraft industry remained an important key in the economic development of J&K UT. Being environment friendly, these activities are best suited to the UT as they are more labour intensive and less capital intensive in nature, therefore having scope for employment generation at a large scale. Handmade products are exported all over India and other parts of the world. Kashmiri handicrafts eliminated financial crises among those people who are affected with the physical disabilities. After handicrafts gained foreign exposure with positive feedback, many youth made this, their profession. Kashmiri Handicrafts is the second largest and preferable industry after fruit in Kashmir Valley, and have earned worldwide fame for their attractive designs, functional utility and high quality craftsmanship. In absence of other manufacturing industries in the state, handicrafts remained a key economic activity from time immemorial. The present study focuses on employment and production of handicrafts in the erstwhile Jammu and Kashmir state now a Union territory.