Himachal Budget Cuts Minister Salaries, Boosts Rural Welfare Amid Fiscal Stress

The Himachal Pradesh government presented a Rs 54,928 crore budget for 2026-27 with a sharp focus on rural development and fulfilling key welfare guarantees. Austerity measures include a temporary 50% salary cut for the Chief Minister and reductions for ministers and MLAs to ease fiscal pressure. The budget is smaller than the previous year's as the state grapples with a debt exceeding Rs 1 lakh crore and a significant revenue deficit. Despite financial constraints, the state aims for 8.3% economic growth, prioritizing agriculture, women's welfare, and long-term self-reliance.

Key Points: HP Budget: Salary Cuts, Rural Push & Welfare Guarantees

  • Rs 1,500 monthly aid for women
  • 300 units free electricity
  • 50% salary cut for CM
  • Budget size reduced by Rs 3,586 cr
  • State debt crosses Rs 1 lakh crore
2 min read

HP bets on rural push, welfare guarantees in Rs 54,928 cr budget; CM announces salary cuts for ministers amid fiscal stress

Himachal presents Rs 54,928 cr budget with austerity measures, free electricity, women aid, and a focus on rural economy despite high debt.

"The move is aimed at easing fiscal pressure without impacting welfare schemes."

Shimla, March 22

The Himachal Pradesh government on Saturday presented a Rs 54,928 crore budget for 2026-27, focusing on strengthening the rural economy and fulfilling key election guarantees, while simultaneously announcing austerity measures, including temporary salary cuts for top functionaries.

Presenting his fourth budget, Chief Minister Sukhvinder Singh Sukhu said the government aims to make Himachal Pradesh a self-reliant state by 2030, with a strong emphasis on rural development, agriculture, and social welfare.

As part of its flagship commitments, the government announced financial assistance of Rs 1,500 per month to women from one lakh families, provision of 300 units of free electricity per month, and the setting up of a dedicated commission for farming to boost the agriculture sector.

Amid financial constraints, the Chief Minister also unveiled temporary salary cuts, including a 50 per cent reduction in his own salary, 30 per cent for ministers and senior bureaucrats, and 20 per cent for MLAs and other officials. The move is aimed at easing fiscal pressure without impacting welfare schemes.

The budget size reflects a reduction of Rs 3,586 crore compared to the previous fiscal year's Rs 58,514 crore. The state's debt has crossed Rs 1 lakh crore, underscoring the challenging fiscal environment.

According to estimates, revenue receipts stand at Rs 40,361 crore, while revenue expenditure is pegged at Rs 46,938 crore, leading to a revenue deficit of Rs 6,577 crore. The fiscal deficit is projected at Rs 9,698 crore.

Despite these constraints, the state economy is expected to grow at 8.3 per cent, with the Gross State Domestic Product (GSDP) estimated at Rs 2,54,000 crore and per capita income at Rs 2,83,626.

The expenditure pattern indicates that for every Rs 100 spent, Rs 27 will go towards salaries, ₹21 for pensions, Rs 13 for interest payments, Rs 9 for debt repayment, and Rs 20 for capital works and development, while Rs 10 is allocated as grants to autonomous institutions.

Sector-wise, education has been allocated Rs 9,660 crore, health Rs 2,868 crore, women and child development and welfare of Other Backwards Classes Rs 1,544 crore, urban development Rs 542 crore, and energy Rs 250 crore.

The budget speech was delivered in three parts over 4 hours, 9 minutes, and 31 seconds.

In a symbolic shift towards sustainability, Sukhu arrived at the Assembly in an electric vehicle this year, unlike previous years when he drove his personal car to present the budget.

The budget reflects the government's dual approach of fiscal discipline and welfare expansion, with a clear focus on rural empowerment and long-term economic self-reliance.

- ANI

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Reader Comments

R
Rohit P
Salary cuts for ministers and MLAs is a good symbolic gesture, but is it enough? The state debt is over ₹1 lakh crore! Austerity should start with cutting wasteful expenditure and improving tax collection. Free electricity is popular, but with such a high fiscal deficit, is it sustainable long-term? 🤔
A
Aman W
As someone from a farming family in Himachal, I'm glad to see a dedicated commission for farming announced. Apple growers have been facing issues for years. The budget needs to translate into concrete support for procurement, storage, and market access. Fingers crossed! 🍎
S
Sarah B
The CM arriving in an electric vehicle is a nice touch for sustainability messaging. However, the allocation for energy is only ₹250 crore while free electricity is promised. There seems to be a mismatch. Investing in renewable energy generation within the state should be a higher priority to make such schemes viable.
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Vikram M
The budget size is reduced but debt is mounting. For every ₹100, ₹61 is going just towards salaries, pensions, and interest! That leaves very little for actual development. The 8.3% growth projection seems optimistic under these circumstances. Need more focus on generating revenue through tourism and industry.
K
Kavya N
Education getting ₹9,660 crore is the highest allocation and that's commendable. Building a self-reliant state by 2030 needs investment in human capital. Hope this means better infrastructure in government schools and colleges in rural areas, not just in Shimla.

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