Himachal Pradesh Unveils Rs 54,928 Crore Budget with Fiscal Austerity Measures
Shimla witnessed a significant fiscal announcement as Himachal Pradesh Chief Minister Sukhvinder Singh Sukhu presented the state budget for the financial year 2026–27 on Saturday. The budget, with a total outlay of Rs 54,928 crore, marks a reduction of Rs 3,568 crore compared to the previous year. This contraction is primarily attributed to the discontinuation of the revenue deficit grant (RDG) by the central government and the state's escalating debt burden.
Budget Presentation and Central Government Criticism
Presenting his fourth budget—a comprehensive document spanning 136 pages delivered over four hours—Sukhu, who also holds the finance portfolio, did not mince words in criticizing the central government. He highlighted that the halt of the RDG would result in an average annual loss of Rs 8,105 crore for Himachal Pradesh, leading to a projected revenue deficit of Rs 6,577 crore for the upcoming financial cycle. This move has placed the state in a serious financial situation, necessitating immediate and stringent measures.
Temporary Salary Deferment Across Government Levels
In response to the fiscal crunch, the chief minister announced a temporary salary deferment for six months across various tiers of government. This measure is designed to alleviate immediate financial pressures and is structured as follows:
- 50% deferment for the chief minister's salary.
- 30% deferment for the deputy chief minister and cabinet ministers.
- 20% deferment for MLAs, chairpersons, vice-chairpersons, and political appointee advisors.
For bureaucrats, the deferment includes:
- 30% deferment for senior officials such as the chief secretary, DGP, head of forest department, additional chief secretaries, ADGPs, principal secretaries, and principal and additional chief conservators of forest.
- 20% deferment for secretaries, all heads of departments, IGPs, DIGs, SSPs, SPs, chief conservator of forests, conservator of forests, and DFOs.
- 3% deferment for Group A and B officers for the next six months.
Group C and D employees have been exempted from this measure, ensuring protection for lower-level staff. Additionally, respecting the constitutional independence of the judiciary, the state government expressed hope that the high court may consider a voluntary six-month deferment of 20% of salaries for district and additional district judges, along with 3% for Group A and B judicial officers.
Strengthening Rural Economy and Agricultural Support
Outlining a vision of a prosperous Himachal through "Vyavastha Parivartan" (systemic transformation) in the rural economy, Sukhu announced several initiatives to bolster agricultural and allied sectors. Key announcements include:
- Establishment of the Himachal Pradesh State Farmers' Commission to address farmer concerns and promote sustainable practices.
- Increase in procurement prices: cow milk from Rs 51 to Rs 61 per litre and buffalo milk from Rs 61 to Rs 71 per litre starting next financial year.
- Significant hikes in minimum support prices (MSP): turmeric from Rs 90 to Rs 150 per kg, wheat from Rs 60 to Rs 80 per kg, maize from Rs 40 to Rs 50 per kg, and barley produced in Pangi valley from Rs 60 to Rs 80 per kg.
- First-time announcement of MSP for ginger at Rs 30 per kg in the state.
- Subsidy of Rs 5,000 per bigha for seed production to encourage quality cultivation.
Currently, around 2.23 lakh farmers across 38,455 hectares are engaged in natural farming practices in Himachal Pradesh. To protect crops from wild animals, Rs 10 crore has been allocated under the ‘Mukhya Mantri Khet Badhbandi Yojana'. The state also aims to increase forest cover to 32% by 2030 and develop 50 new eco-tourism sites in the coming year, promoting environmental sustainability alongside economic growth.
Boost to Fisheries Sector
In a move to strengthen the fisheries sector, the chief minister launched the ‘Mukhya Mantri Machhuara Sahayata Yojana'. This scheme sets the MSP for reservoir fish at Rs 100 per kg and reduces the royalty rate on fish caught from reservoirs from 7.5% to 1%, benefiting approximately 6,000 fishermen. Additionally, fishermen will receive a 70% subsidy through Direct Benefit Transfer (DBT) for the purchase of boats, enhancing their livelihoods and supporting local economies.
This budget reflects a balanced approach, combining fiscal prudence with targeted support for rural and agricultural communities, as Himachal Pradesh navigates its financial challenges while striving for sustainable development.
