Tag: Chairman

· Demands a separate DRI for hill states

Chief Minister Thakur Sukhvinder Singh Sukhu met Chairman of the 16th Finance Commission Dr. Arvind Panagariya at New Delhi on Thursday and discussed the various relating to state’s fiscal health.

He said that Himachal Pradesh had been facing the brunt of natural disasters for the last three years losing precious lives and suffering a loss of more than Rs. 15,000 crore. The damage to environment and infrastructure was colossal. He apprised that the Supreme Court also made an observation in July, 2025 that revenue could not be earned at the cost of environment and ecology and it could prove detrimental for the entire state. The hill State of Himachal Pradesh have limitations to achieve revenue growth beyond a certain level. Essential public services have to be provided as part of constitutional obligations and with more than 67 percent of our area as forest land, there was very little space to maneuver.

He requested that the Revenue Deficit Grant (RDG) should be continued for a revenue deficit state like Himachal Pradesh. The justification for continuation and quantum of RDG has been reflected in additional memorandum and main memorandum submitted by the State Government to the Finance Commission. He requested not to taper RDG which should be determined on the realistic assessment of State’s revenues and expenditure projections during the award period by 16th Finance Commission. He urged that RDG should be kept at a minimum level of Rs. 10,000 crore annually.

The Chief Minister said that a detailed justification for increasing the weightage for the criteria of forest and ecology has been submitted by the State to the Commission. He requested that snow covered-cum-cold desert areas i.e. above the tree line should be included along-with very dense forests and moderate dense forests areas for their symbiotic relationship.

He said the state had also requested for creation of a separate ‘Green Fund’ with earmarked annual allocation of Rs. 50,000 crore for the hill States for the ecological services being provided to the country in different forms. This fund may be carved out or earmarked in the form of a scheme as Special Central Assistance to States for Capital Investment (SASCI). The matter had also been discussed with the Prime Minister and even through a letter written to him.

Sh. Sukhu said there was a need to reframe the Disaster Risk Index (DRI) developed by the 15th Finance Commission as the Himalayan region could not be equated with rest of the country as far as various hazard vulnerabilities and their respective weightages were concerned. The uniform matrix developed does not include hazards like landslide, snow avalanches, cloudbursts, forest fires and Glacial Lakes Outburst Flood (GLOFS) and the increased frequency of these hazards during the recent past impacting the mountainous region was a case in point.

He said that because of low DRI, Himachal Pradesh did not get adequate resources from 15th Finance Commission to meet its requirement of disaster relief, despite facing disproportionately higher brunt of disasters. He requested that a separate DRI may be prepared for hill states by considering the unique indicators as mentioned above and a separate allocation may be made for hill states which could further be distributed horizontally amongst these states on the basis of the new DRI.

The Chief Minister said that since 16th Finance Commission was in the process of finalizing its report, the submissions of the state may be considered sympathetically while finalising the recommendations, so that the state finances remain sustainable. He assured the Chairman that the State would do everything possible to move towards a path of fiscal prudence.