Sukhvinder Singh Sukhu, the Chief Minister of Himachal Pradesh, has assured that the state government will not reduce spending on social welfare schemes, salaries, or pensions in the upcoming state budget. He said the budget will focus on the welfare of all sections of society while also working towards making the state financially self-reliant.
The chief minister made the statement ahead of the state budget, which is scheduled to be presented on March 21. He spoke about the government’s plans during discussions held before a special pre-budget meeting at the state secretariat in Shimla.
According to Sukhu, the government is preparing what he described as a “self-reliance budget.” The aim is to improve the state’s financial strength without reducing benefits provided to people through social welfare programmes.
The chief minister said that even though the state is facing financial challenges due to changes in central financial support, the government will ensure that public welfare programmes continue without interruption.
He added that salaries of government employees and pensions for retired workers will also remain unchanged in the upcoming budget.
One of the major financial challenges facing Himachal Pradesh is the decision to stop the Revenue Deficit Grant (RDG). This grant is financial support provided by the central government to help certain states manage their budget deficits.
The 16th Finance Commission has recommended that the Revenue Deficit Grant for Himachal Pradesh be discontinued in the coming years.
According to Chief Minister Sukhu, this decision could lead to a major loss of funds for the state. He said the state may lose between ₹8,000 crore and ₹10,000 crore every year between 2026 and 2031 because of the discontinuation of the grant.
Such a large reduction in financial support means the state government will need to strengthen its own sources of revenue. Sukhu said this situation has made it important for Himachal Pradesh to work towards financial self-reliance.
Despite these challenges, the chief minister said the government will not reduce funding for welfare schemes that support ordinary citizens.
He said the government understands that many families depend on these programmes. Therefore, the administration will continue supporting them while also improving financial management.
Sukhu explained that the government has been holding several consultations with experts, officials, and other stakeholders while preparing the upcoming budget.
These discussions are aimed at finding ways to increase revenue, improve financial planning, and ensure sustainable economic growth for the state.
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While discussing the state’s financial situation, Sukhu also highlighted the role Himachal Pradesh plays in protecting the environment.
He said the state contributes greatly to maintaining the ecological balance of the country. According to him, Himachal’s forests and natural resources provide environmental benefits worth more than ₹90,000 crore every year.
However, the chief minister said the state receives very little financial compensation for these environmental services.
Sukhu explained that if the state government were allowed to use its forests for large-scale commercial purposes, it could generate significant revenue. But because forests must be protected for environmental reasons, such activities are restricted.
He suggested that states like Himachal Pradesh should receive better financial support from the central government because they help protect the country’s natural environment.
The chief minister also spoke about the revenue generated from hydropower projects in the state. Himachal Pradesh is known for its large number of hydroelectric power plants because of its rivers and mountainous terrain.
Several major hydropower projects in the state are operated by central public sector companies such as SJVN, NHPC, and NTPC.
Sukhu said the state currently receives only 12 percent royalty from these hydropower projects. Royalty is the share of revenue that the state government receives for allowing companies to use its natural resources.
According to the chief minister, if hydropower projects become free from debt and the state is given 50 percent royalty instead of 12 percent, Himachal Pradesh would become financially much stronger.
He said such a change would reduce the state’s dependence on financial support like the Revenue Deficit Grant.
The chief minister stressed that the government is committed to balancing financial discipline with social welfare.
He said the upcoming budget will focus on both economic stability and public welfare. The government plans to strengthen its revenue sources while continuing to support citizens through social schemes.
Sukhu added that the goal of the budget is not only to manage present challenges but also to create a strong economic foundation for the future.
According to him, the state government wants Himachal Pradesh to gradually become financially independent while ensuring that people continue to receive essential support from the government.
The budget presentation on March 21 is expected to outline the government’s strategy for achieving these goals while addressing the financial impact of losing the Revenue Deficit Grant.
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