Himachal Pradesh Reduces Budget to ₹54,928 Crore, Targets Debt and Welfare

In an unprecedented move, Himachal Pradesh has reduced its budget by Rs 3,586 crore for the 2026-27 fiscal year, bringing the total outlay to Rs 54,928 crore from Rs 58,514 crore in the current fiscal. Chief Minister Sukhvinder Singh Sukhu, who also holds the Finance portfolio, said the decision was necessary to tackle a mounting debt burden inherited from the previous BJP government.

Speaking in the state Assembly, Sukhu emphasized that the time for populist spending was over, stating, “The people of the hills are tough and resilient and will face a financial crisis bravely.” He added that the reduction reflects a focus on cutting unproductive expenditure while prioritizing welfare for the most vulnerable sections of society.

For the first time since 1952, Himachal Pradesh is presenting a budget without the Revenue Deficit Grant (RDG) from the Centre. Sukhu attributed the state’s financial distress to the discontinuation of the RDG and the end of GST compensation, accusing the previous BJP administration of pushing Himachal into a debt trap by failing to settle outstanding loans.

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Highlighting poverty alleviation measures, the Chief Minister said the government would identify the poorest families on the state’s BPL list for targeted support under the Mukhya Mantri Apna Sukhi Parivar scheme. Around one lakh of the most deprived families will receive 300 units of free electricity, housing assistance for 27,000 families lacking pucca homes, and Rs 1,500 for women in these households as part of the scheme’s guarantees.

The budget session witnessed disruptions when BJP legislators, led by Leader of Opposition and former Chief Minister Jai Ram Thakur, stormed the Well after Sukhu criticized the party’s handling of the RDG issue. After a 20-minute disruption, the Chief Minister resumed his speech, reiterating that stopping the grant was “unfair and an injustice with the people of Himachal.”

Sukhu also announced sector-specific measures, including a minimum support price (MSP) of Rs 100 per kg for fish under the Mukhya Mantri Machuara Sahayta scheme. The budget, presented by the Chief Minister for the fourth time, reflects a balancing act between fiscal consolidation and targeted welfare in the face of financial challenges.

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