The Centre today ruled out any dialogue with separatists in Jammu and Kashmir in near future, saying its priority was to improve the situation in the valley first.
"Our priority is to improve the situation first," Minister for Defence and Finance Arun Jaitley told reporters here when asked if the Centre had any plans to hold talks with separatist groups like Hurriyat Conference in view of the demand repeatedly made by the BJP's alliance partner, the PDP.
Jaitley, who was here for a meeting on Goods and Services Tax (GST), was also asked by a reporter whether there was a possibility of replacing Mehbooba Mufti as chief minister by a BJP nominee in view of the deteriorating security situation.
"I have not heard of any such thing. I am not aware of this thing," the senior union minister replied.
Jaitley, who in his capacity as Defence Minister reviewed the security situation in Kashmir yesterday, said it was not as bad as the impression was being given by some media outlets.
The situation in the valley is improving, he said.
"Well, I can only say this that I had a detailed meeting with Chief of Army Staff (Gen Bipin Rawat) and all the senior officers of the Army last night. The defence secretary designate was also with me.
"The Army's principal job is to look after the Line of Control (LoC) and also some conflict management which is required. In both the areas, the Army is fully confident of dealing with the situation," he said.
Refusing to divulge details, the Defence Minister said, "Military strategies are not disclosed or discussed in public. We must all have good faith in the capacity of the Army. And whatever effective steps are required, both on the LoC and to ensure normalcy within the state will be taken."
In response to a question, he said, "It is obvious that there are certain categories of foreign infiltrated terrorists".
Asked what message was being conveyed by holding GST Council meeting here, Jaitley evaded a direct reply but maintained that the situation in the valley had improved.
"Look, the invitation from Srinagar (for holding the meeting) was pending for long now. Ministers and officials from all parts of the country have come here. A lot of improvement in the situation was witnessed.
"All people, who have come here, before their arrival, a notion was created by electronic media... That has changed drastically. People are freely moving around. In fact, they have been moving since yesterday, and are moving around again after the meeting. Some are even staying back after the meeting," he said.
To a question about GST eroding the taxation autonomy of Jammu and Kashmir, Jaitley said, "it is for the state of Jammu and Kashmir and assembly to decide what they want to do and I am sure that the state will take an appropriate decision."
He, however, said it was "clear to any person who understands the taxation system that both the state government and the consumers will hugely be benefitted" by integrating taxes with the GST.
"Jammu and Kashmir is not a producing state. It is a consuming state. GST is a consumption-based tax. So the tax which is not here in Jammu and Kashmir for production, the tax will be given on consumption," Jaitley said.
He said with the implementation of the GST, the tax revenue of Jammu and Kashmir will significantly increase like other consumption states.
By not integrating with the GST, the consumers in Jammu and Kashmir will have to pay higher prices for products.
"The consumers will get credit for input only if the state is integrated with the GST. Otherwise, they will pay taxes both for input as well as the final product.
"Anyone saying don't implement GST is basically saying that the consumer from my state should buy expensive products," Jaitley added.