Introduction
Himachal Pradesh is located in the northern region of India. The state is surrounded by Jammu and Kashmir on the north, Punjab on the west and the south-west, Haryana on the south, Uttar Pradesh on the south-east, and China on the east.
At current prices, Himachal Pradesh’s gross state domestic product (GSDP) is estimated to be Rs. 2.27 trillion (US$ 27.27 billion) in 2024-25.
Total exports from Himachal Pradesh stood at US$ 2,23.20 million in FY25 (Until August). The key items exported from Himachal Pradesh include drug formulations and engineering goods, cotton yarn, manmade yarn, fabrics and madeups.
In FY24, drug formulations and biologicals exports from Himachal Pradesh stood at US$ 1.61 billion million, which accounted for 69.5% of the total exports.
As of August 2024, Himachal Pradesh had a total installed power generation capacity of 4,561.63 MW, comprising 2,077.92 MW under private utilities, 1,062.21 MW (state utilities) and 1,397.50 MW (central utilities). Himachal Pradesh has immense potential for hydropower as it is naturally blessed with abundant streams and rivers flowing down from towering mountains.
The State Government of Himachal Pradesh offers a wide range of policy and fiscal incentives for businesses under the Industrial Policy, 2017. The state has also undertaken other policies such as Tourism Policy 2005 and IT Policy 2001 for upgradation of these sectors in the state. Himachal Pradesh has announced a Revised Solar Policy 2016, under which it plans to establish 700 MW of solar photovoltaic cell capacity.
Himachal Pradesh will have the world’s longest and highest tunnel by 2025, which will connect Zanskar Valley in Ladakh to Lahaul in Himachal Pradesh and will be 4.25 km in length.
According to the Department for Promotion of Industry and Internal Trade (DPIIT), the cumulative FDI inflows in Himachal Pradesh were valued at US$ 246.74 million between October 2019-July 2023.
Key Sectors
- The state government has committed to establishing Integrated Public Health Labs in all districts by 2026, covering children's transportation costs to primary schools, and appointing 6,000 nursery teachers in 2024-25, showcasing its focus on healthcare, education, and human resource development.
- The state has allocated Rs. 2,457 crore (US$ 294 million) towards Women and Child Development and will cover educational expenses of children of widows with annual income below Rs. one lakh (US$ 1,197) under the Mukhya Mantri Sukh Shiksha Yojana, demonstrating its commitment to empowering women and supporting the welfare of weaker sections.
- The state will increase MGNREGA daily wages by Rs. 60 (US$ 0.72) and provide up to Rs. 3 lakh (US$ 3,591) assistance to build houses for widowed, single, and destitute women workers.
- Ministry of Pharmaceuticals inaugurated three new centers of the Central Institute of Petrochemicals Engineering & Technology (CIPET). These centers have been established in the states of Himachal Pradesh, Jharkhand, and Madhya Pradesh. Himachal Pradesh has emerged as a hub of drug manufacturing units and meets 35% of the demand for pharma products in Asia.
- In October 2022, Prime Minister Mr. Narendra Modi flagged the new Vande Bharat Express from Amb Andaura, Una to New Delhi.
- In October 2022, Prime Minister Mr. Narendra Modi laid the foundation stone of two hydropower projects in Chamba, Himachal Pradesh - the 48 MW Chanju-III Hydro-electric Project and the 30 MW Deothal Chanju Hydro-electric Project. Combined, these will generate 270 million units of electricity yearly.
- In October 2022, Prime Minister Mr. Narendra Modi laid the foundation stone of the Bulk Drug Park at Haroli in Una district, which will be built at a cost of Rs. 1,900 crore (US$ 231.35 million) and provide employment to more than 20,000 people.
- In September 2022, in accordance with the National Education Policy, the Himachal Pradesh Cabinet approved the Himachal Pradesh Early Childhood Care and Education Tutor Scheme-2022 for children in government primary schools between the ages of 3 and 6.
- In July 2021, Sonalika Group invested Rs. 200 crores (US$ 26.93 million) in Himachal Pradesh to build India's largest harvester manufacturing facility.
- Amidst the current rabi season in June 2021, Himachal Pradesh procured a record 1,00,657 quintals of wheat.
- Agriculture is the main occupation and the major source of employment in the state, as 89.96% of the population lives in rural areas. With suitable agro-climatic conditions, Himachal Pradesh has realised the importance of commercial crops, including off-season vegetables, potatoes and ginger. To increase production of foodgrains, emphasis has been laid on distribution of seeds of high-yielding varieties to the farmers. During 2020-21, 1,340 hectares of additional area was envisaged to bring under fruit plants, against which 2,589 hectares of area has already been brought under plantation.
- In March 2022, the Central Government approved Rs. 108 crore (US$ 13.95 million) for the Integrated Digital Agriculture Platform in Himachal Pradesh, which will increase in-house capability in supplying farmers with information and communication technologies (ICT)-based services, saving administrative time and enhancing efficiency.
- Himachal Pradesh is one of the fastest-growing regions in the pharmaceutical industry in India, driven by incentives announced by the state Government in its Industrial Policy, 2004. In FY22, drug formulations and biologicals exports from Himachal Pradesh stood at US$ 975.08 million, which accounted for 45.4% of the total exports.
- The tourism sector of Himachal Pradesh contributes 7% to the state GDP. Domestic tourist inflow in the state reached 15.07 million in 2022, while foreign tourist arrivals reached 29,333. As of December 2019, there were 3,679 registered hotels in the state.
- In September 2022, the central government sanctioned the Urban Transport Ropeway Project worth Rs. 1,546.4 crore (US$ 187.92 million) for Shimla in Himachal Pradesh.
- In April 2022, the Ministry of Civil Aviation and the Himachal Pradesh government signed an MoU (Memorandum of Understanding) for the development of a Greenfield Airport in Nagchala, located in the district of Mandi in Himachal Pradesh. The project is estimated to cost around Rs. 900 crore (US$ 116.24 million), excluding the cost of land.
- In April 2022, National Highways Logistics Management Limited (NHLML) and the Himachal Pradesh government signed a memorandum of understanding (MoU) on for seven ropeway projects in the state under the Parvatmala Yojna at a total cost of Rs. 3,232 crore (US$ 417.44 million). The project will cover a total length of 57.1 km.
FACTFILE
Capital
ShimlaGeographical Area (sq km)
55,673State Language
Hindi and PahariLiteracy Rate
82.8 per centKey Industries:
Textiles
Pharmaceuticals
Food procurement and processing
IT and ITeS
Electronics
Light engineering
Cement
Tourism
Hydropower
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