CM Thakur Sukhvinder Singh Sukhu met Union Finance Minister Nirmala Sitharaman in New Delhi and sought a special central assistance package to offset the revenue deficit for the financial year 2026–27.
During the meeting, the Chief Minister expressed concern over the discontinuation of the Revenue Deficit Grant (RDG), stating that the move would have serious repercussions on the financial stability of Himachal Pradesh. He pointed out that RDG constituted nearly 12.7 percent of the state’s revenue—second only to Nagaland—and argued that hill states like Himachal Pradesh cannot be compared with larger states that are better equipped to absorb such financial shocks.
Describing the uniform assessment of states as “unfair” and lacking transparency, the Chief Minister said the withdrawal of RDG undermines the spirit of cooperative federalism. Citing Article 275(1) of the Constitution of India, he emphasized that such grants are intended to support states unable to bridge the gap between revenue receipts and expenditure. He added that this was the first time the Finance Commission had overlooked the developmental needs of small hill states.
Highlighting the state government’s fiscal discipline, Sukhu informed the Union Finance Minister that over the past two to three years, measures had been taken to curtail expenditure, avoid off-budget borrowings, and mobilize around ₹600 crore annually through various cesses. However, he noted that revenue losses due to GST and limited scope for further tax hikes and subsidy rationalization have made it difficult to eliminate the deficit.
The Chief Minister also urged the Centre to set up a committee to comprehensively assess the economic challenges faced by hill states and recommend corrective measures.
Responding to the concerns, Nirmala Sitharaman assured that the demands of the state would receive sympathetic consideration.
Sponsored
Nurturing Creativity – Keekli Charitable Trust, Shimla
