The trade body appealed the government to take measures for upgrading the drainage system in order to prevent repeat of the situation.
"We urge the government to take all necessary measures to upgrade the drainage system so that the water logging in city centre and downtown areas that gives an impression of flood like situation is avoided," President KCC&I Sheikh Ashiq Ahmad told reporters here.
He said KCC&I is worried as lot of cancellations has happened in the past week due to rise in the water level owing to inclement weather.
The KCC&I president said the water level rose because of continuous rains early this week but the "flood like situation was in fact caused due to decades old inefficient drainage system which caused water logging in commercial areas like Lal Chowk, Residency Road and Hari Singh High Street.
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"Since the people had the September floods on their mind, a wrong signal about threat of floods went around which led to cancellation of bookings, affecting tourist inflow into Kashmir," he said.
He said the media has a "positive role" to play in presenting the true picture about the situation in Kashmir.
"We want media to play a positive role and show to the world that we are ready for tourists once again," he added.
On special package for traders affected by floods last year, he said the government has sought some time and had assured that it would come out with a package shortly.