You are partially correct in your understanding. However, that is not the complete picture.
Firstly - there is no doubt that the Indian government has a poor record in socio-economic development. Not just Kashmir, but also the North-East bear testimony to that fact. So no argument on that.
However, it is also true that the Indian government has invested more per capita in J&K than in any other Indian state. Graft and corruption have ensured that nothing good came of it. Whether it is the Abdullahs or the Saeeds, they play the same game and the result is for all to see.
And finally, we must also understand the agenda of the Separatists. They are scared that if Kashmiris end up going about their lives like people everywhere else, then the entire "issue" will be forgotten. So they try to make sure that students do not appear for exams and tourists avoid the valley. This in turn will result in the feedback loop wherein desperate citizenry out of options will lash out at the government which they feel has failed them, thereby achieving the Separatists' goal.
This game has been played a over the world, from the US to Iraq. As educated and informed people it is our responsibility not to fall for it and to understand all aspects of the issue. Governance can only succeed in that situation, otherwise it fails everywhere.
The fact that Indian govt has poor record is the mother of all evils.
Kashmir is not something like North East for that matter, is it ? You must know it is inhabited by the proud muslims, who will not just give up fighting for their rights until they have had one.
I say this always and I wil it again. There is nothing, nothing that Pakistan provide to those Kashmiris that India cant,
Say, if we do any developmental work in that region, India can match it with 10 times more money and development. So all this nonsense of Kashmir getting integrated into PAkistan is nothing but just to piss-off Indian by waving PAkistani flag,. In reality every kashmiri knows that PAkistan cannot provide for them. Either give them their right or give them independence. The latter is quite hard and the former is far more easier. But Trust me Indians will never do that. Never.
Secondly, Why do you think fake Insurgency in Baluchistn is failing ? Because, after Cpec Their concerns are being looked after of not giving the province their rights and what not. Every other day you hear news that XYZ group is laying down its weapon. Why ? because everyone is realising there that these fake bughtis have done nothing and now State of PAkistan is damn serious about developing the most-neglected province. Which means work for everybody.
YOu indians have this obsession of taking credits for things which never belonged or were done by you. Shamelessly singlehandedly taking all the credit for creation Bdesh, While ignoring the Due credit to Infamous Arsehole known as Bhutto.
The person who engineered the breakup of East PAk, by denying them their due right. India just took the advantage of opportunity. The whole thing was sustained and created by ZAB. If it were not for his ego the independence would have been smooth. He denied them their right ( also the West Pakistan as whole) This is exactly what you guys are doing in Kashmir.
Lastly, youre just playing the rules of separatist and actually increasing more hatred, even the ones who dont want to raise arms against the Indian state in Kashmir would willingly pick when you kill them and force them into subjugation rather than providing them with jobs and development. Which is their right.
Trust me I am the last person to see Indian muslims blood being spilled. ( Though I have sympathy for everyone as general rule). But since they're muslims I will have more preference to them, when it comes to killing and subjugating them/
So it is upto you Indian to decide if you really want to keep Kashmir by providing them with schools, jobs, medical facilities, or just letting the money go down the corruption ( knowingly it well) or to keep on killing them and forcing them in to subjugation and also incurring more suicides in CPRF after kashmir operations.
I trust sanity will prevail