Shimla, Mar 21 (UNI) Himachal Pradesh Chief Minister Sukhvinder Singh Sukhu, while responding to budget discussions for 2025-26 in the state assembly, revealed that the state government has spent over Rs 20,000 crore on development works over the past two years.
Despite financial constraints, the government claims to have prioritised development, even as it grapples with mounting debt and reduced central grants.
Sukhu, who also holds the finance portfolio, stated that the state borrowed Rs 29,063 crore in the last two years, but nearly half of this amount was used for repaying loans and interest payments.
He highlighted that the state received Rs 44,157 crore over three years, including GST compensation and Revenue Deficit Grant (RDG) from the 15th Finance Commission, averaging Rs 14,719 crore annually.
However, in 2022-23 and 2024-25, the state received no GST compensation and only Rs 14,316 crore as RDG, averaging Rs 7,158 crore per year—less than half of the previous amount. This is expected to drop further to Rs 3,257 crore in 2025-26.
The Chief Minister criticised the previous BJP government for leaving behind unpaid salary and pension arrears, as well as liabilities from schemes like Sahara and Himcare.
He accused the previous administration of indiscriminately opening institutions and constructing buildings without necessity while focusing on distributing freebies.
Sukhu emphasised that his government had the courage to prepare the budget based on actual resources, despite the financial challenges.
The state’s total debt is nearing Rs 1 lakh crore, with the Congress government repaying Rs 12,266 crore in interest and Rs 8,087 crore in principal from the Rs 29,046 crore borrowed. Only Rs 8,693 crore remained for development, yet the government spent Rs 20,353 crore on development works in two years.
Sukhu also pointed out that Rs 8,246 crore of the loan taken in 2022-23 was already borrowed by the previous government.
The budget for 2025-26 proposes a capital expenditure of Rs 3,976 crore, which is higher than the RDG received. Sukhu attributed this to additional resource mobilisation efforts, the results of which are expected by 2025.
He also criticised the 15th Finance Commission for reducing Himachal’s RDG by Rs 3,425 crore compared to the 14th Finance Commission, questioning the logic behind the reduction.
Despite increased central tax shares, Sukhu warned that global economic challenges could impact future collections. He highlighted that state tax revenues have grown at an average rate of 12.5% under his government, outperforming the previous administration.
The Chief Minister expressed confidence that ongoing resource mobilisation efforts would further boost state revenues in the coming years.
UNI ML ARN