Union Minister for Culture and Tourism Gajendra Singh Shekhawat emphasized that Himachal Pradesh has received increased Revenue Deficit Grant (RDG) in recent years. He stressed the need for states to enhance their revenue systems and practice fiscal discipline to address fiscal deficits effectively. Shekhawat responded to Chief Minister Sukhvinder Singh Sukhu’s concerns regarding the 16th Finance Commission’s impact on the state’s economy and upcoming budget.
The Union Minister explained that RDG serves as a temporary measure to aid financially strained states in managing short-term gaps. He highlighted that the provision was not intended as a permanent entitlement. Shekhawat acknowledged the support provided to Himachal Pradesh in tourism and infrastructure development by the Central Government, including interest-free loans for tourism infrastructure under the Special Assistance for Capital Infrastructure scheme.
Shekhawat underscored the importance of states improving fiscal management to offset the reduction in RDG without compromising development expenditure. He also cautioned against escalating debt-to-GDP ratios, signaling the need for corrective financial planning. The Minister mentioned the increase in tax devolution to states under the new Finance Commission formula and the rise in Himachal Pradesh’s share, emphasizing the state’s potential for sustainable financial management.
