Nilgiri
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Not according to your own indian sources. But I wont go into that because it's a problem that affects you (literally), not me. But to claim that Pakistan pursuing its interests in Kashmir and providing moral/diplomatic and other support to Kashmiris as a reason behind stifled economic growth in Pakistan is beyond absurd and intellectually lazy. At any rate the support will continue and there's nothing anyone can do about it
Post these own Indian sources? I go by international accepted figures, not random articles one can find that can concoct numbers out of thin air or use old/dubious sources.
The estimate for 2015 is 44% (not 67%):
http://data.unicef.org/water-sanitation/sanitation.html
This figure will drop drastically in the years to come as the full govt focused programs come into play. The target is 0% by 2019.
So we can maintain Kashmir and develop at the same time. Its not a question of choosing one of the two.....I mean look at our overall HDI compared to Pakistan. Indians live longer, earn and consume more (and are growing income wayfaster) and are better educated...and the disparity in all of these is only increasing each year....so indeed maybe it is you that should introspect about the level of resources you have diverted away from especially schooling (given Pakistan literacy rate is actually falling now) to your military before criticizing India.
http://hdr.undp.org/en/composite/HDI
Otherwise don't bring the development angle to it in the first place and stick to solely saying its an indigenous phenomenon or whatever.