Reeling under an acute financial crunch, the Himachal Pradesh government raised its highest-ever loans amounting to ₹41,173 crore and also repaid loans worth ₹32,004 crore in the financial year 2025-26, as per the revised budget estimates.
A provision for raising loans amounting ₹11,965 has been made in the budget for the financial year 2026-27.
The rising debt and interest burden of the Himachal government and discontinuation of Revenue Deficit Grants (RDG) has become a challenge for the economy alongside the narrow tax base.
2 March 2026
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As per the figures provided in the "Budget in Brief", the loan liability of the government stood at ₹1,03,994 crore in 2025-26 which is estimated to touch ₹1,12,319 crore in 2026-27.
The total debt burden of the government was ₹76,681 crore in 2022-23, ₹85,295 crore in 2023-24 and ₹93,625 crore in 2024-25, showing a rising trend. Interest payment was ₹6,260.93 crore in 2024-25 and ₹6,693 crore in 2025-26, and has been pegged at ₹7,271 crore in 2026-27.
The Fiscal Responsibility and Budget Management (FRBM) has also reflected increasing trend in interest payment and estimated it at ₹8,115 crore in 2027-28 and ₹8,865 crore in 2028-29 while scaling down the subsidies from ₹3,205 crore in 2025-26 to ₹858.98 crore in 2026-27, ₹910.52 crore in 2027-28 and ₹965.15 crore in 2028-29.
The situation was worrying as the committed expenditure of the government on salaries, pension, debt repayment, interest payment and other heads was about 80 per cent of the budget and only 20 per cent was left for capital works and other activities.
