Kashmir's economy is centred around agriculture. Traditionally the staple crop of the valley was rice, which formed the chief food of the people. In addition, Indian corn, wheat, barley and oats were also grown.
Given its temperate climate, it is suited for crops like asparagus, artichoke, seakale, broad beans, scarletrunners, beetroot, cauliflower and cabbage. Fruit trees are common in the valley, and the cultivated orchards yield pears, apples, peaches, and cherries. The chief trees are deodar, firs and pines, chenar or plane, maple, birch and walnut, apple, cherry.
Historically, Kashmir became known worldwide when Cashmere wool was exported to other regions and nations (exports have ceased due to decreased abundance of the cashmere goat and increased competition from China). Kashmiris are well adept at knitting and making Pashmina shawls, silk carpets, rugs, kurtas, and pottery. Saffron, too, is grown in Kashmir. Efforts are on to export the naturally grown fruits and vegetables as organic foods mainly to the Middle East. Srinagar is known for its silver-work, papier mache, wood-carving, and the weaving of silk.
The economy was badly damaged by the 2005 Kashmir earthquake which, as of October 8, 2005, resulted in over 70,000 deaths in the Pakistan-controlled part of Kashmir and around 1,500 deaths in Indian controlled Kashmir.
The Indian-administered portion of Kashmir is believed to have potentially rich rocks containing hydrocarbon reserves.