a) Hindu majority entire Jammu Region, Buddhist majority Ladakh District, Shia majority Kargil District and Anantnag district containing Holy Amarnath Temple and required for settling all refugee Kashmiri Hindus called Pandits be formed into a new normal Indian State like any other called "Kashmir" only with permanent capital at Anantnag city.
b) Rest of Kashmir Valley with all Sunni majority districts of Srinagar, Badgam, Pulwama, Baramulla and Kupwara along with permanent capital Srinagar city be made a separate Indian state with Article 370 of Indian Constitution called "North Kashmir."
These steps will save the people of Jammu, Ladakh and the Pandits & Shia Muslims from highhandedness of Sunni Kashmiri Muslims of Vale of Kashmir being beneficial to India by restricting separatism and the insurgency to just 15% area of current 'Jammu & Kashmir' state. Non-Muslims in both Jammu & Ladakh reduced from 90% in 1951 census to 65% and 51% respectively due to influx of Muslims from valley of Kashmir as per 2001 census and unless these policies are implemented now, even Jammu and Ladakh will become Muslim majority like Kashmir valley very soon.
Or else, merger of neighbouring Himachal Pradesh with Jammu & Kashmir to make Indian 'Kashmir' 70% Hindu majority and make up for loss of 40% land to Pakistan and China which will solve its Muslim majority problem and Buddhist majority Chittagong Hill Tracts in Islamic Bangladesh who hoisted Indian Flag on 15th August 1947, also be annexed by India as part of Tripura state.
If people of Jammu Region, Ladakh Region and Himachal Pradesh don't agree to any of the above two choices then Hindu majority entire Jammu Region, Buddhist majority Ladakh District, Shia majority Kargil District and Anantnag district containing Holy Amarnath Temple and required for settling all refugee Kashmiri Hindus called Pandits be severed only from current "Jammu and Kashmir" state of India and merged with Himachal Pradesh.