The budget session of the State Assembly, which begins on February 16 in Shimla, is likely to be overshadowed by the financial crunch in Himachal Pradesh, especially after the 16th Finance Commission's recommendation to withdraw Revenue Deficit Grant (RDG).
While the state government that finds itself handicapped to go ahead with the planned budget for 2026-27 in the wake of RDG withdrawal has been left cribbing, calling it grave injustice by the Centre with mountain states like Himachal, the BJP is counter blaming the Congress government for not putting forth the view point before the Finance Commission effectively. The government's effort to have an all-party meeting on the issue turned out to be a fiasco as BJP walked out of it, holding that the government was shifting the blame on the centre for its own financial mismanagement.
Leader of Opposition, Jai Ram Thakur said the government was taking the pretext of RDG withdrawal for not being able to give employees their due arrears and so on." But I want to ask them that did they give employees their due when they were receiving RDG for three years? Were they giving jobs to the youth as per the poll guarantee before information on withdrawal of RDG?. The government is just playing politics on the issue," he said.
The Bharatiya Janata Party leaders said the government will get over ₹2000 crore extra in this budget for various schemes, but they are just crying for RDG. " The 15th Finance Commission had given tapering funds over five years under RDG and it had hinted that the RDG would ultimately be withdrawn. It has been done for 17 states, not only Himachal. The present government knew it and should have tried to adjust its finances accordingly and done some exercise to mobilise resources," said state BJP chief, Dr Rajeev Bindal. He alleged that Congress government had been misusing funds to benefit few people in the government.
The government in fact is caught in its own web as it had been saying that Himachal will emerge a self-reliant state in 2027 and by 2032 it will be the richest state. The people are now questioning the basis of such statements, wherein the reality is that just the withdrawal of RDG has confused the government as to how to manage.." RDG used to fill 12.7 percent of the budget gap. This year, we won't get it. So the state budget would have reflection of it," said a senior government high up.
More so the government's dependence on Centre for RDG has exposed its claims on self-reliance— " Did the Congress government ask the Centre before giving the guarantees to allure people, if it were to deliver services with Central funding only, " said the Leader of Opposition.
Chief Minister Sukhvinder Sukhu has however tried to placate people, who were upset with a presentation by Finance Secretary, wherein he indicated that giving Old Pension Scheme, arrears to employees and some other social welfare benefits to people would not be possible after withdrawal of RDG. " We will continue to give the existing benefits to people, including OPS. It is the Central government which is pressurising us to stop OPS," the CM said. He blamed BJP for not taking a clear stand on RDG.
The Congress government is likely to raise the issue of RDG in Assembly and may ask the BJP to join the Congress Chief Minister in demanding RDG back by meeting the Prime Minister. The BJP, on the other hand, may try to skirt it by putting the blame on Congress government for not planning the finances well, misusing funds on meaningless 'Avastha Parivartan' and failing to put forth a strong view point before the 16th Finance Commission in larger public interest.
All said and done, it is going to be a tight rope walk for the Chief Minister, who is also the Finance Minister, to formulate a budget for 2026-27, which supposedly has to be relaxing in the fourth year of the government, but for the financial crisis demonstrated after withdrawal of RDG. So far, the state government has not been able to have friendly policies for different sections of society in its quest for ' Vivash Parivartan' - an action that now hangs heavy on the Sukhu government for cuts in finances from the top.
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