He also demanded the release of all the political detainees in the state after the abrogation of Article 370 in August last year.
In a major political move, the government had in August last year scrapped Article 370 and enacted a law to bifurcate the state into two Union Territories (UTs) Jammu and Kashmir and Ladakh.
"Bring a bill in the current session itself to restore full statehood to Jammu and Kashmir," Azad said on Tuesday while speaking during the motion of thanks in the Rajya Sabha in response to the President's joint address.
"We hope that the government would now admit its mistake," he added.
Azad noted the role of the security forces in the country, but said that when there are tensions in a border state, it is the common man who first bears the brunt.
The senior Congress leader and former minister also drew the attention of the government to the protests by women at Shaheen Bagh in Delhi and appealed for addressing their concerns.
Hundreds of women have been protesting against the controversial Citizenship Amendment Act (CAA) that grants citizenship to non-Muslims facing religious persecution in three neighbouring countries Pakistan, Afghanistan and Bangladesh.
"Not a single minister of the government has talked about addressing the issue. The government seems to be on a war path," the Congress leader said.
( With inputs from IANS )