Chairman of 15th Finance Commission, NK Singh on Wednesday said Himalayan states, including Himachal Pradesh, needed special attention as they are vulnerable to the natural calamities and the losses therein.

“It is a problem in North Eastern and other hill states, which needs to be redressed. The Commission is already looking at the issue of disaster management afresh, especially the funding pattern and the best response mechanism. We are reviewing it and are conducting a robust and intensive study. We will send the person to Himachal also to look at the situation here,” said Singh.

The 15th Finance Commission had arrived here on Tuesday for two-day consultation meetings in Himachal, which is the tenth state visited by the Commission so far for.

The Chairman of the Commission debt to GDP management was a continuous concern in Himachal Pradesh and said at 38 per cent it was unsustainable and unacceptable.

He, however, said the state has significantly brought it down, in absolute terms it is more. “A debt reduction plan is need of the hour for Himachal. The state can have a medium term plan for adhering to fiscal deficit targets. If the direction and momentum is correct, it would help,” he said. He said the issue of fiscal discipline has to be addressed.

Singh said the issue of revenues from GST is a problem area for the Commission. The GST regime is settling down, but a continuous worry.

He said Himachal’s economic potential is yet to be realised, and the state has huge opportunity.

He said Himachal can cash in on tourism in a big way. Tourism is a big economic growth engine internationally. The unspoilt natural beauty of the state is an unrealised opportunity. But for that connectivity has to be improved,” he said. He said there is need to improve rail, road and air connectivity, which could be a big trigger to economic development in the hill state.

The Chairman of Commission said the state had a huge potential for hydro power generation. “The state can be a source of renewable energy not only for its self needs but for the other states. However, the problem is that Government of India does not recognise the hydro power beyond a point for point,” he said.

He said unlocking Himachal’s hydro power capacity will make enormous difference in economic development and quantum of energy available. “It is an area of concern. I feel that hydro power should be treated as renewable energy.

The Commission Chairman said the CM talked about the vulnerability of Himachal as border state (internationally) in government’s memorandum.

“The Commission will certainly take this in account and will factor it. But much depends on the Central government, the home and defence ministries,” he said.

Replying to a question, Singh said the issue of funding to Panchayats, while leaving the two other tiers of PRI, was highlighted by various states, and the Commission will take it in account. “All the three tiers need to be enabled appropriately.”