Himachal Statehood carved in mountain stone

Tikender Singh Panwar/  Dr K L Chandel, Shimla, Apr 20,

Nestled in the Himalayas, Himachal Pradesh celebrates two important milestones in its journey to statehood: April 15, 1948, when it was established as a Chief Commissioner’s Province comprising 30 princely states including Mandi, Suket, Chamba, Mahasu, and Sirmaur—marking the beginning of a unified administrative identity; and January 25, 1971, when it became the eighteenth state of India, fulfilling a long-standing aspiration of its people. The latter is now commemorated annually as Himachal Pradesh Statehood Day.

Ancient and Medieval Roots

Himachal Pradesh’s history dates back to prehistoric times. Archaeological evidence suggests human habitation during the Stone Age. In the pre-Vedic period, tribes like the Khasas, Kirātas, Kinners, Kulūtas, Kunindas, and Audumbaras shaped the region’s socio-cultural foundation. With the rise of the Indo-Aryans, small kingdoms flourished, many ruled by the Kirātas.

During the medieval era, hill states such as Chamba, Kulu, Mandi, and Sirmaur maintained autonomy under local rulers. This independence lasted until the British established control following the Anglo-Gorkha Wars. Simla (now Shimla) was declared the summer capital of British India, centralising administration and boosting infrastructure development.

After India gained independence in 1947, the princely states faced an uncertain future. In response, a provisional body—the ‘Himalayan Prant Provisional Government’—was formed to integrate these territories into the Indian Union.

Himachal’s Three Developmental Phases

Himachal’s political and economic journey can be broadly divided into three phases:

1. 1948 to 1971 – Foundation and consolidation
2. 1971 onwards – Statehood and planned development
3. Post-1991 – Shift to neoliberal economic policies

In 1950, Himachal was designated a ‘C’ state under the new Indian Constitution. Dr. Yashwant Singh Parmar became the first Chief Minister in 1952 and laid the foundation for the state’s future. The integration of Bilaspur in 1954 expanded its territory. Despite nationwide linguistic reorganisation in 1956, Himachal remained a Union Territory due to its distinct identity.

The restoration of the Legislative Assembly in 1963 bolstered local governance. The inclusion of hilly areas from Punjab—like Kangra, Una, Shimla, and Hamirpur—under the Punjab Reorganisation Act of 1966 strengthened its claim for statehood. This culminated in the State of Himachal Pradesh Act, passed in December 1970, granting full statehood from January 25, 1971.

This transition wasn’t just administrative but also rooted in cultural unity and geographic coherence. The people’s hard work, coupled with the adoption of modern technology, drove post-statehood development.

Economic and Social Progress

Himachal Pradesh made significant strides after 1971. The First Five-Year Plan in 1948 allocated ₹52.7 million toward infrastructure and agriculture, laying the foundation for an agrarian economy. Measures to improve crop productivity and diversify agriculture supported the rural population.

Infrastructure became a focal point, especially in overcoming the challenges of mountainous terrain. Projects like the Bhakra Nangal Dam boosted hydroelectric production and supported irrigation and industrialisation. From the 1980s, industrial hubs such as Baddi, Nalagarh, and Parwanoo attracted investments in pharmaceuticals, textiles, and food processing.

Education saw dramatic improvements, with rising literacy rates and access to schools and colleges contributing to socio-economic mobility. Simultaneously, tourism emerged as a vital sector. Himachal’s natural beauty, biodiversity, and spiritual significance attracted millions of tourists, boosting local economies and preserving cultural heritage.

Despite Hindi being the official language, the region remains a mosaic of dialects and cultural traditions. This rich diversity has been maintained alongside a unifying administrative identity.

Challenges in the Neoliberal Era

However, from the late 1990s, Himachal Pradesh’s development model came under strain due to changing fiscal policies at the national level. The central government’s emphasis on ‘fiscal discipline’ required states to limit their fiscal deficits to below 3.5% of their State Gross Domestic Product (SGDP). For a resource-constrained state like Himachal, this shift was challenging.

Under the Fiscal Responsibility and Budget Management (FRBM) Act, Himachal Pradesh was compelled to limit public spending. To cope, successive governments—both Congress and BJP—curtailed non-plan expenditures by halting recruitment and declaring thousands of posts ‘surplus’. In a single move, over 30,000 posts in the Education Department were abolished in the late 1990s. The trend continued across sectors.

For example, the Himachal Pradesh Electricity Board had around 45,000 employees in the late 1980s for 6 lakh consumers. By 2019, while the number of consumers rose to 22 lakh, the workforce had shrunk to just 13,000.

Privatisation and Outsourcing

Another response to financial constraints was the gradual privatisation of public services. The health sector exemplifies this shift. Many hospitals outsourced staff hiring to private agencies, often offering no job security. Rogi Kalyan Samitis (RKS) at hospitals now manage recruitments, including doctors, under contract systems.

Other departments follow similar patterns. The Transport Department, for instance, hires drivers and conductors on contracts with salaries as low as ₹8,000 per month, while regular employees earn up to ₹60,000. Outsourcing and contract-based employment have degraded service quality, especially in critical areas like electricity restoration in snowbound regions.

Land, Identity, and Political Flux

Land rights have always been central to the Himachali identity. When Uttarakhand was formed, protective land laws ensured that land remained with locals. Himachal had similar protections under Section 118 of the Land Reforms and Tenancy Act. However, gradual dilution of these provisions has opened the door to outside investors, threatening the small and marginal farmers.

This economic shift has also had political repercussions. Since the 1990s, no political party has been able to win consecutive terms. Voters, disillusioned by economic stagnation and rising unemployment, have swung between the BJP and Congress. A strong public expectation persists that the state government must address issues like employment and basic services, but constrained finances often limit its capacity to deliver.

The Way Forward

 Himachal has shown that despite being a backward state in productive sectors, there can be leaps and bounds of success and development, being second to Kerala in the human development indices. However, the state is also caught in a vortex of financial constraints and climate change risks inhibiting its development trajectory.

The state recently organised a colloquium in Shimla where experts from a variety of fields converged on the way forward for its development trajectory. Some of the highlights include reclaiming the state’s rights in water and levying cess on the hydro power companies. The chief minister of the state has been unequivocally arguing for such an arrangement and is planning to bring out a new law on it.  Likewise, emphasis on startups and incubators to bring in the entrepreneurial skills is of the utmost importance. What is the USP of the state? A child would point out that it is a clean environment that should be made an upfront priority for the future. In another decade or a few decades, major disruptions are bound to happen, which will be driven by the Internet of Things and AI. This transition should not be missed by the state, and with its unique USP, instead of harping on heavy industries, which, anyway, is not possible, the state should start strategizing on the transition path for a secure and climate-resilient future.

Tikender Singh Panwar, former deputy mayor of Shimla

Dr Kishori Lal Chandel, Assistant Professor of History, Government College, Shimla

Team Himachal Scape