Azad made his announcement after he told a Congress convention in Jammu's Udhampur town that his party would get a majority in the polls, expected in October.
"Things might be bad for the Congress in J&K, but its top leader shying away from elections gives a pretty bad impression", said Harpreet Singh, 35, a businessman in Jammu city.
The parting of ways with the regional National Conference (NC) has put the Congress in an unenviable position in the assembly polls.
It is now pitched against the BJP, which is eyeing power in the state and also against the NC, which has said it would field candidates against the Congress.
"Whether the BJP gets power on its own or not, the fact is that they will definitely improve their lot at the cost of the Congress during the elections," said Harbans Nagokay, a senior Jammu-based journalist.
In the Valley, the NC believes that severing ties with the Congress is likely to come in handy as aligning with the centrist party did not augur well for the NC, which is largely a Valley-centric party.
"We have already paid a heavy price by aligning with the Congress. We oppose the Armed Forces Special Powers Act (AFSPA) and demand its repeal. The Congress, for obvious reasons, prefers to remain silent on this," said a senior NC leader here.
With the Congress having to field candidates in the Valley against the NC, the division of votes could benefit the opposition PDP led by former chief minister Mufti Muhammad Sayeed.
The Congress has three seats in the Valley - Kokernag, Dooru and Uri - represented by three ministers, Peerzada Sayeed, G.A. Mir and Taj Mohiuddin.
"With the NC now fielding candidates against all the three, their chances of victory would suffer badly. The advantage would obviously go to the PDP," said Abdul Salam Bhat, 62, a resident of the Valley's Anantnag district.
Azad's home district of Kishwar and the other three districts of Doda, Ramban and Reasi in the Chenab Valley are also likely to throw up surprises in the assembly elections.
"The seven seats in the Chenab Valley region are no longer in anybody's kitty. There would be keen contest and surprises are likely to be thrown up," said Muhammad Taskeen, a local in Ramban district's Bannihal town.
News from constituencies in Jammu, Kathua and Samba districts is not heartening for the Congress.
Vijaypur, Akhnoor, Chambb, Gandhi Nagar and Hira Nagar, which were once believed to be strong Congress bastions, are also up for grabs as it was the BJP candidate who grabbed the votes in the Lok Sabha elections.
State BJP spokesperson Khalid Jahangir told IANS Prime Minister Narendra Modi would be holding five election rallies in the state to garner support for BJP candidates.
If the PDP gets the largest number of seats in the state short of a simple majority, would it align with the BJP?
"Ideologically it would be very difficult for the PDP to align with the BJP, but wasn't (Chief Minister) Omar Abdullah a minister in the Vajpayee-led NDA government", asked a senior PDP leader who did not want to be named.
If politics is art of the possible, then the PDP aligning with the BJP might not ruffle many a feather in J&K after the assembly elections.
For the record, the NC has 28 seats in the 87-member assembly, the PDP 21, the Congress 17, the BJP 11, the Panthers Party two and the Communist Party of India-Marxist one. The remaining seven seats are with smaller parties and independents.
The Congress had entered into a power sharing arrangement with the PDP in 2002, with Mufti Mohammad Sayeed handing over the baton to Azad in 2005. However, the PDP pulled out in 2008 following the row over the allotment of land to the Amarnath Shrine Board.
After a brief spell of governor's rule, elections were held in November-December and a Congress-NC government assumed power in January 29, this time with Omar Abdullah at the helm for the full six-year term.