Himachal PWD Minister calls Union Budget 2026-27 "disappointing", criticises RDG withdrawal

Shimla (Himachal Pradesh) [India], February 2 (ANI): The Public Works Department (PWD) Minister of Himachal Pradesh, Vikramaditya Singh, on Monday described the Union Budget as disappointing for the hill state and said that if the Revenue Deficit Grant (RDG) has been discontinued for political reasons, it is "extremely unfortunate."
Speaking to the media in Shimla, Singh said Himachal Pradesh had high expectations from the Union Budget presented on February 1 by Union Finance Minister Nirmala Sitharaman, but the state received no special mention.
"If the Revenue Deficit Grant has been stopped with a political mindset, then it is very unfortunate. This issue will be discussed in detail in the state Cabinet meeting scheduled for Sunday," he said.
The minister said Himachal Pradesh has been receiving revenue deficit grants since Independence, which have played a crucial role in sustaining the state's finances.
"Himachal Pradesh has always received RDG, but now it has been completely withdrawn. The state government has consistently raised issues related to the interests of Himachal, and the people are deeply hurt by the discontinuation of this grant," Singh said.
He emphasised that the matter goes beyond party politics. "This is not an issue of Congress versus BJP. It is about the interests of the people of Himachal Pradesh. All political parties should rise above differences and collectively present the state's case before the Centre," he said.
Vikramaditya Singh also highlighted the adverse impact of the Goods and Services Tax (GST) on hill states such as Himachal Pradesh. "After five years, GST was rationalised. Earlier, the highest GST revenue for Himachal came from the cement industry, but the tax rate was reduced from 28 per cent to 18 per cent, causing losses to the state," he said.
Explaining the structural disadvantage, he said GST is a consumption-based tax. "GST benefits states with large populations. Himachal Pradesh and other northern hill states will never fully benefit from GST, not even in the next 100 years. We are a production state. We manufacture cement and pharmaceuticals, but consumption happens elsewhere, and GST revenue goes to those states," Singh noted.
He said Himachal Pradesh used to receive Rs 3,000-4,000 crore before GST, but the system has now shifted revenue away from producing states. "For hill states across the country, special financial schemes are required to sustain their economies. We have raised this issue repeatedly," he added.
Regarding disaster-related funding, Singh said the Disaster Risk Index (DRI) parameters do not account for the higher costs in hilly terrain. "If a road is damaged in Uttar Pradesh and a similar road is damaged in Himachal Pradesh, the cost of restoration in Himachal is much higher. Yet the parameters remain the same. Our state can never become a revenue-surplus state," Vikramaditya Singh said.
On pension reforms, the PWD minister said the New Pension Scheme (NPS) has adversely impacted the state's borrowing capacity. "Due to NPS, borrowing of around Rs 1.6 billion has been stopped. This issue requires a serious approach. The Old Pension Scheme was restored not for political gain, but in the interest of employees," he said.
Vikramaditya Singh also said the state government has taken up several issues with the Centre, including apple imports and hydropower royalties.
"I met Union Commerce Minister Piyush Goyal regarding apple imports and informed him that a joint team of fruit growers and state officials will hold discussions with the Commerce Ministry. I also met the Union Power Minister and raised the issue of inadequate royalty from hydropower projects," he said.
Speaking about the state of roads, Vikramaditya Singh said that 435 roads under the PWD are currently closed, and efforts are underway to restore connectivity.
"To prevent damage to roads caused by water from nullahs, the department is bringing a new drainage policy. Instead of U-shaped drains, V-shaped drains will be constructed in the future. This new drainage policy is also being incorporated into DPRs," he said.
The minister said the government is committed to strengthening road infrastructure and reducing losses caused by waterlogging and natural disasters. (ANI)