Replying to the debate in Rajya Sabha on the resolution for extension of President's Rule in the state and a bill that seeks to grant reservation benefits to people residing along International Border on the lines of that available to residents of Actual Line of Control, he said that Centre was not interested in running the state from Delhi and assembly elections will be held on dates decided by the Election Commission.
The resolution was unanimously adopted and the bill approved by the House. These were cleared by Lok Sabha on Friday.
Shah, who is also BJP chief, said Modi government has devised a new security policy by disengaging it with the security policy and the policy of zero-tolerance for terror will continue.
The Home Minister said the Congress governments had followed "appeasement policy" towards the Kashmir valley that had led to grievances in the other regions of the state.
"We have continued with a single approach towards Kashmir but if the problem persists even after 70 years it becomes imperative for us to review and adopt a new approach. We are all for development but there will be no place for separatists and terrorists here," he said.
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Shah said that country was paying for the mistakes made by India's first Prime Minister Jawaharlal Nehru and if the country had not gone for a ceasefire during the 1947-48 war, the one-third part of the state would not have been under occupation of Pakistan and the state would have been free of its present problems.
"We must learn from history. Congress must answer for the historical blunders done by them. Why did Nehru government go to UN despite Kashmir's accession to India? Why did he agree for a plebiscite that is any case out of question today," he said.
Shah said Modi government's commitment to policies of "Jamhooriyat, Insaaniyat, Kashmiriyat" should not be taken to mean that the forces who want to divide India will be spared.
"Anyone who talks of breaking India will get an appropriate response in the same language. You join the efforts of the government. The responsibility of protecting your life and property is that of the central government," he said.
Several opposition leaders took part in the six-hour debate with Leader of Opposition Ghulam Nabi Azad calling for early elections and accusing the government of failing to improve conditions in the state.
Azad, a former chief minister of state, said that government was taking credit for peaceful panchayat elections and asked why it could not hold assembly polls along with Lok Sabha elections.
Shah reiterated that Jammu and Kashmir is an integral part of the country and it cannot be separated.
"It is a matter of appreciation that the whole house is unanimous on issues related to the state. The government want to want simultaneous development of Jammu, Kashmir and Ladakh without any discrimination," he said.
Shah said it was not feasible to hold assembly polls with Lok Sabha elections due to the requirement of security forces.
He talked of surgical strike of 2016 and the aerial strikes earlier this year and said the government was taking the battle to the place of origin of terror.
Earlier, moving the resolution and the Bill, Shah said that the government has no other option but to further extend President's Rule in Jammu and Kashmir for six months as the Election Commission wants to hold Assembly elections in the state by the end of 2019.
On the Reservation Bill, the Home Minister said it will benefit 3.50 lakh people residing in border areas of Jammu and Kashmir.
The present term of President's Rule in the state is ending on July 2.