Shimla: Himachal Pradesh is set to face an annual financial loss exceeding Rs 10,000 crore due to the 16th Finance Commission’s recommendations, deputy chief minister Mukesh Agnihotri has said. Criticising the Central govt’s Budget, he described the move as a “long-term crisis” that weakened the state’s financial structure. Agnihotri termed the situation a “double blow” to the hill state’s economy. The first hit came with the cessation of goods and services tax (GST) compensation, which has already strained the finances of mountain states with limited revenue sources. The second, the more severe impact, was the abolition of the revenue deficit grant (RDG), a vital institutional support for states like Himachal Pradesh, he added.“Ending RDG is policy injustice that undermines the federal structure,” Agnihotri underlined, highlighting that a significant portion of the state’s Rs 58,000 crore budget was already committed to salaries, pensions, and essential expenditures. Over the last five years, Himachal received Rs 38,000 crore via RDG and, considering inflation and economic shifts, the state expected this to rise to Rs 50,000 crore. Its removal now threatens ongoing developmental projects and welfare schemes,” he added.Agnihotri stressed that Himachal Pradesh’s dependence on Central assistance was not a weakness, but a constitutional obligation due to its unique geography. Since the state’s formation in 1952, there was a national consensus on providing special financial support to border and mountain states, he added. Launching a scathing attack on the state’s BJP MPs and former chief minister Jairam Thakur, the deputy chief minister accused them of remaining silent and failing to protect Himachal’s rights. He demanded that they should clarify whether they stand with the Central govt or with the interests of the state, warning that public trust cannot forgive inaction on a matter causing a Rs 10,000 crore annual loss.
