One of the solutions for the Kashmir problem is to grant more autonomy for the state. But Arvind Lavakare in this article writes that the state has all the freedom it wants by staying with the Indian Union.
J&K is the only state in India where a distinction has been permitted to be made between state citizens (designated as ‘permanent residents’) and other Indian citizens (who are not ‘permanent residents’) and where — contrary to the principles of equality before the law (Article 14), prohibition of discrimination on the ground of place of birth (Article 15) and equality of opportunity in public employment (Article 16), — laws are permissible to confer special rights and privileges on ‘permanent residents’ with respect to employment under the state government, acquisition of immovable property in the state, settlement in the state and right to scholarships as well as other state government aid
As though all of the above and more besides was not enough to honour the ‘special status’ of J&K, the nugget that insults the dignity of India is Section 64 of the J&K constitution. This section stipulates that the oath of affirmation to be made by i. a candidate for election to the state legislature ii. a member of the state legislature iii. a deputy minister and a minister (including the chief minister) of the state government and iv. a judge of the state high court should ‘bear true faith and allegiance to the constitution of the State as by law established.’ Note that the allegiance here is exclusively to the constitution of J&K state and not to the Constitution of India in addition.[Rediff]
So here you have a pampered state which does not owe allegience to the Indian Union and still get subsidised by the country and no political party in India has the guts to abrogate this.