Himachal Pradesh Debt to Cross Rs 1.12 Lakh Crore by 2026-27, Fiscal Pressure to Rise
Shimla, March 23,
Himachal Pradesh debt in 2026-27 is projected to cross Rs 1.12 lakh crore. Budget data shows rising borrowings and increasing fiscal pressure.
Budget documents presented by Chief Minister Sukhvinder Singh Sukhu indicate a steady rise in the state’s liabilities over the past few years. As per page 12 of the budget in brief document the total debt stood at Rs 85,295 crore in 2023-24 and increased to Rs 93,625 crore in 2024-25 (revised estimates). It is further expected to reach Rs 1,03,994 crore in 2025-26 before touching Rs 1,12,319 crore in 2026-27.
The rising debt trajectory reflects increasing fiscal pressure amid limited revenue growth and high expenditure commitments.
Borrowings continue to drive finances
Himachal Pradesh continues to rely significantly on borrowings to manage its finances. The state borrowed Rs 8,644 crore in 2023-24 and Rs 8,330 crore in 2024-25. Borrowings are estimated to rise to Rs 10,369 crore in 2025-26, before moderating slightly to Rs 8,325 crore in 2026-27.
A closer look at the borrowing pattern shows a heavy dependence on internal sources. In 2024-25, out of total public debt of Rs 26,622 crore, nearly Rs 24,100 crore came from internal borrowings, while only Rs 2,521 crore was received as loans from the Centre.
Internal debt dominates, central support limited
The trend continues in the coming years as well. For 2025-26, budget estimates suggest borrowings of Rs 13,374 crore, including Rs 12,209 crore from internal sources. However, revised estimates indicate a much higher borrowing requirement of Rs 41,173 crore, with Rs 38,408 crore coming from internal debt alone.
Also read:Himachal Economic Survey 2025-26 debt burden in focus as RDG exit looms
Repayment obligations are also rising significantly. In 2025-26, the state is expected to repay Rs 32,004 crore, pointing to a growing debt-servicing burden.
By 2026-27, the state plans to raise Rs 11,965 crore, almost entirely through internal borrowing, while central loans are projected to remain negligible at just Rs 62 crore.
Over 90% borrowings now internal
More than 90 per cent of Himachal Pradesh’s borrowings now come from internal sources, highlighting an increasing shift towards market loans and institutional finance rather than central assistance.
This structural shift has long-term implications, as higher reliance on internal debt typically comes with tighter repayment schedules and interest obligations.
With debt levels rising and repayments consuming a larger share of resources, the state’s fiscal space is expected to shrink further.
Financial experts warn that unless revenue mobilisation improves, the growing debt burden could begin to crowd out developmental expenditure in the coming years, impacting infrastructure creation and welfare delivery.
The emerging fiscal picture places Himachal Pradesh at a critical juncture, where managing debt sustainably while maintaining growth and public spending will be a key challenge for the government going forward.
About the Author
The HimachalScape Bureau comprises seasoned journalists from Himachal Pradesh with over 25 years of experience in leading media conglomerates such as The Times of India and United News of India. Known for their in-depth regional insights, the team brings credible, research-driven, and balanced reportage on Himachal’s socio-political and developmental landscape.