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Centre ‘financially squeezing’ Himachal, says industries minister
Appealing for unity, the industry minister said political differences should be set aside during crises
Himachal Pradesh industries minister Harshwardhan Chauhan has accused the Bharatiya Janata Party (BJP) government at the Centre of “financially squeezing” the state, while alleging that successive reductions in central grants and compensation have severely impacted development of the state, already battling with destructions due to recent natural disasters.
The delay in release of funds hampering effective restoration, he added.
“Prime Minister Narendra Modi had announced ₹1,500 crore for Himachal during a visit to Dharamshala following disaster damage. The 75 lakh people of Himachal are still waiting for that assistance. If it is released, it will bring major relief,” said Chauhan, on Friday while hitting out at BJP for “misleading” people by saying. “Government of India was providing ample financial support to Himachal.”
Appealing for unity, the industry minister said political differences should be set aside during crises. “When the state is going through difficult times, everyone must come together and fight for Himachal’s rights,” he added.
“The Centre has not given anything over and above our entitlement,” he said, adding that restoration of damaged national highways, particularly in the Kullu–Manali region, was progressing at a slow pace.
He said “Himachal has traditionally depended on liberal central assistance due to its fragile economy, but such support has been curtailed in recent years. There have even been attempts to politically destabilise the state.”
Referring to losses caused by heavy rains, the minister said Himachal suffered damages worth ₹10,000 crore in 2023 and about ₹5,500 crore in 2025, but adequate financial assistance was not provided on time. He accused the Centre of attempting to “choke the state financially” to slow down its development.
Citing figures, he said the revenue deficit grant to Himachal has steadily declined from ₹10,257 crore in 2021–22 to ₹3,257 crore in 2025–26, resulting in a cumulative shortfall of nearly ₹8,000 crore. He also pointed out that the discontinuation of GST compensation after 2022 caused an additional loss of around ₹2,500 crore, taking the total financial impact to nearly ₹10,500 crore.
The minister said the state’s additional borrowing limit was reduced by ₹1,770 crore, and requests for enhanced borrowing permission despite repeated natural disasters were not approved.
Chauhan said, adding that the state government has been trying to overcome challenges through resource mobilisation and policy reforms under the leadership of chief minister Sukhvinder Singh Sukhu.
Despite financial constraints, the minister said the state government has kept the pace of development intact and intensified efforts to make Himachal self-reliant. “Between 2017 and 2022, during the BJP regime, resource mobilisation was about ₹5,564 crore. In just three years, our government has mobilised nearly ₹50,000 crore,” Chauhan claimed.
He alleged that the previous government misused the state exchequer through populist announcements that were not financially sustainable. “Free electricity up to 125 units caused an annual loss of ₹1,000–1,200 crore. The 50% concession for women in HRTC buses weakened the financial condition of the transport corporation, and making water connections free resulted in a loss of about ₹100 crore,” the minister said.
Outlining initiatives to boost industry, the minister said the state will organise an MSME-focused festival and exhibitions to promote local products under the “One District, One Product” concept. Women entrepreneurs, food producers, artisans and traditional craft makers will also be given platforms. He said around 100 CEOs and investors will interact with the CM in Shimla on January 4 to discuss expectations from the state government.
