Dhumal blames HP govt's lack of preparedness for financial crisis

Former HP CM Prem Kumar Dhumal criticises the state govt for the financial crisis, citing a lack of preparedness for the known withdrawal of the Revenue Deficit Grant and contrasting it with his own tenure's fiscal discipline.

Senior BJP leader and former Himachal Pradesh Chief Minister Prem Kumar Dhumal has expressed concern over the state's current financial situation, saying the fiscal stress is not sudden but the result of long-anticipated challenges that the government failed to address in time.

Dhumal Blames Govt's Lack of Preparedness for Financial Crisis

According to a BJP release, Dhumal said the phased withdrawal of the Revenue Deficit Grant (RDG) was well known in advance and had been clearly mentioned in the Finance Commission's recommendations. Dhumal noted that RDG had already been clarified to end after 31 March 2026; therefore, characterising it as a new or unexpected development is misleading.

He questioned why the state government did not develop alternative revenue-generation strategies and a robust financial management plan, given ample time to prepare. According to the BJP's release, he emphasised that implementing the Finance Commission's recommendations is a constitutional responsibility of the Central Government, and that, rather than creating confusion or indulging in political blame games, the state government should introspect and explain its own lack of preparedness.

Drawing on Past Experience: A Call for Fiscal Discipline

Drawing on his experience as Chief Minister, Dhumal said that economic challenges are common for resource-constrained states, but responsible governance lies in taking timely and tough decisions. During difficult financial phases, his government adopted strict fiscal discipline, controlled discretionary expenditure, curtailed unnecessary travel and official luxuries, and ensured that even the highest offices led by personal example. He added that he himself ensured simplicity in official conduct and avoided placing avoidable financial burdens on the state exchequer.

Highlighting structural reforms undertaken during his tenure, Dhumal said, "The government focused on strengthening agriculture and horticulture to enhance state revenues. By promoting vegetable production and marketing, annual turnover increased from around Rs 250 crore to nearly Rs 2,250 crore. He further stated that the decline in apple production was offset by diversification into alternative crops, which significantly improved revenue and contributed to a stronger budgetary balance."

Criticism of Current Government's Expenditure

Taking an indirect dig at the present government, he remarked that while the government speaks of financial distress, it is simultaneously appointing numerous chairpersons, advisors, and office-bearers, resulting in substantial additional expenditure. Spending on new vehicles, extra staff, and official facilities contradicts the principles of financial discipline. If the situation is genuinely grave, the first step should be a strict curb on non-essential expenditure, he asserted.

Honest Dialogue and Decisive Action Needed

On Centre State relations, Dhumal said, "Facts must be presented honestly to the public. He noted that whenever the BJP has been in power at the Centre, Himachal Pradesh has received special support, including industrial packages and benefits associated with special category status. Mere political rhetoric, he said, cannot resolve economic challenges; only sound policy decisions, resource mobilisation, and expenditure control can do so."

Concluding his statement, Dhumal cautioned that repeated public assertions by the state leadership that the treasury is empty weaken public confidence. What is required, he said, is decisive action, a comprehensive review of expenditure, clear prioritisation, and strengthened financial management. Economic challenges, he stressed, can only be addressed through responsible decision-making and disciplined governance. (ANI)

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