Financial crises in Himachal Pradesh

PALAMPUR: The new BJP government who had taken over the reins of state only last month was perturbed over the precarious financial health of the state as previous congress government had left debts worth rupees 22000 crores, payable to various financial institutions and banking agencies.

It may be recalled that in past five years the congress government had raised total loans to tune of Rs.11,000 crore and state government was paying interest over Rs. 3000 crore on these loans annually.

The BJP government which had come into power making promises for the over all development of the state at Gujrat pattern, now finds itself in a quite difficult position, how to meet the financial requirements of the state to go a head with pace of development. Chief minister Prem Kumar Dhumal was deeply worried and he had already called on Prime Minister Manmohan Singh and Finance Minister P.Chindbaram in this regard last month.

He had sought liberal grants from centre to the hill state. Though the Prime Minister had assured him for liberal allocation of funds from the centre still he could not expect much from the UPA government headed by the congress.

Besides taking up new development projects in the state, BJP government was also in difficult situation, how to go a head with the new educational institutions opened by the previous government. The congress government had opened 24 new degree colleges and15 Industrial Training Institutes in the state in past two years, which needed large scale infrastructure and staff to make these institutions operational.

Likewise number of health institutions and schools were also opened by the previous government in state without providing adequate staff. Besides, the congress government had also issued notification before the assembly elections for the setting up of Government Medical College at Mandi. If the BJP government really keen to take this project it also needed over 300 crore which is a major challenge before Mr. Dhumal. BJP who had won maximum seats in Mandi district had no other alternative except to fulfil the commitment of previous government as its political compulsions.

Another factor worrying Mr. Dhumal was the report of 6th pay commission expected in the mid of this year. BJP government was bound to implement the recommendations of pay commission at par with other states, which would further put financial burden of over 500 crores on the state exchequer on account of enhanced salary and allowances of employees annually. At present the state government was paying over Rs. 4000 crore on account of salaries and allowances to its employees. The total revenue receipts of the state government from all resources is about Rs. 2900 crore, which is not even enough to meet the expenditure of salary of the employees.

As for as expansion and development of roads are concerned Mr. Dhumal had less worries because of the fact that he would manage funds under PMGSY and other union government funded schemes from the centre. Though in the beginning Mr. Prem Kumar Dhumal was opposed to raising more loans but he had no other alternative for maintaining the pace of development in the state. He was hopeful that World Bank would soon release the loan for the development of state highways, for which previous government had already signed MOU, this could give much relief to BJP government.

Meanwhile Chief Minister had planned to introduce austerity measures and to impose drastic cut on non planned expenditure in the state. Various head of the department were directed to restrict only to budgetary allocations and avoid unwanted expenditures. Besides, government could also impose ban on the torus of senior officers abroad and outside the state.

A senior journalist from Palampur.

1 Comment

  • I read so many things that we Indian see as congrasi or bjp person. Congress got governess by abusing britishers & BJP etc got governess by abusing congress but no body have a blue print what our country needs. How a man standing at last will say that it is my country. Now he thinks It is the country of people who has money & power. People who have money & power are not sincere to the man standing at last. How you can expect sincerity from man standing at last. Truth is very simple that is yes & no. Not middle path. Middle path is always a dodge. Our persons with power & money adopt midle path. The economy is also middle man based. Persons who get some thing with the grace of god are treated as god. So many gods are there even than the results are not good. No system in the world is good if it does not fulfil its purpose.

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