Premium

Eyeing Rs 1,800 crore: Cash-strapped HP slaps 2% land cess on hydro projects

BBMB to pay Rs 227 crore annually, Nathpa Jhakri, Pong Dam, Kol Dam-1, Kol Dam-2 also to be charged

4 min readShimlaFeb 6, 2026 02:40 PM IST

Himachal Pradesh Chief Minister Sukhvinder Singh Sukhu. (File Photo)

The state has imposed a graded annual land revenue cess of up to 2% on hydropower projects, aiming to raise around ₹1,800 crore a year after the Centre discontinued the revenue deficit grant. (File photo)

Reeling from a financial setback after the Centre discontinued the revenue deficit grant (RDG) worth Rs 40,000 to the state, the Himachal Pradesh government has introduced a 2 per cent annual revenue cess on the total land held by hydropower projects in the state, projecting an annual income of around Rs 1,800 crore.

To this effect, the state government Thursday issued a detailed notification outlining the structure and rates of land revenue to be levied on such projects.

The annual levy has been fixed in a graded slab ranging from 1 per cent to 2 per cent of the project’s average market value.

The hydro projects which were to pay land revenue are including Bhakra Dam being managed by the Bhakra Beas Management Board (BBMB). The move is expected to significantly augment the state’s non-tax revenue from the hydropower sector, a key pillar of Himachal Pradesh’s economy.

As per the notification, the Bhakra Beas Management Board (BBMB) is to pay approximately Rs 227 crore land revenue in respect of land put to use for Non Agricultural purpose (Hydro Power Project) with effect from February 2, 2026. Other projects include Nathpa Jhakri being managed by SJVN to pay Rs 144.4516 Cr, Kol Dam-1, Kol Dam-2 in district Bilaspur and Solan to pay Rs 63 crore and Rs 38 crore annually respectively. Official data shows that more than 180 hydro power projects in districts Shimla, Kinnaur, Bilaspur, Una, Lahaul & Spiti, Chamba, Kangra, Mandi etc fall under the assessment framework.

According to Himachal’s 12 December notification on land assessment, projects facing the highest cess annually include the Bhakra Dam (Rs 227.46 crore), Beas-Sutlej Link (Rs 146.92 crore), and Pong Dam (Rs 58.77 crore). Satluj Jal Vidyut Nigam could pay around Rs 283 crore yearly.

The notification stated that the exercise was undertaken in compliance with the Revenue Department notification issued in October, 2025, issued under Sections 49, 52 and 63 of the Himachal Pradesh Land Revenue Act, 1954.

Story continues below this ad

Meanwhile, BBMB chairman Manoj Tripathi termed the land revenue tax on the Bakhra dam arbitrary and levied despite strong objections on the part of BBMB. Chairman Manoj Tripathi told The Indian Express, “Bhakra Dam is a multipurpose project. One should not see it through the prism of only Hydro power project. It is multipurpose project. We also works in the field of irrigation water and drinking water. Himachal Pradesh is one of our partner state. When we received a latter from the Himachal government proposing land revenue tax, we submitted our valid objections. The foremost was we are not a profit making entity. BBMB is working in the field of nation building.”

A senior officer said, “Records of rights of land used for operational hydro power projects were requisitioned from all concerned District Collectors. Thereafter, under Section 50(b)(iii) and relevant Special Assessment Rules, the market value of projects was obtained from the Director, Energy Department for assessment purposes. A preliminary assessment report — including land classification and assessment blocks — was prepared and submitted for approval to the Financial Commissioner (Revenue), which was sanctioned on December 1, 2025.”

The notification declares that the revised land revenue will be payable with effect from February 2, 2026. As per the notification, project authorities will pay the levy in two equal annual instalments including from April 1 – April 30 and October 1 to October 31. The special assessment will remain in force for 10 years or until a fresh revision is undertaken.

Saurabh Parashar

Saurabh Parashar is an Assistant Editor at The Indian Express, primarily responsible for the publication’s coverage of Himachal Pradesh. He is a seasoned journalist with over 17 years of experience in print media, specializing in crime, legal affairs, and investigative reporting. Professional Background Education: He holds a Master’s degree in Mass Communication from Guru Jambheshwar University of Science & Technology (Hisar) and a Law degree from Himachal Pradesh University (HPU), Shimla. This legal background significantly informs his reporting on complex judicial and administrative matters. Career Path: Before joining The Indian Express in 2017, he spent 12 years with The Times of India. Core Beats: His primary focus is the socio-political landscape of the hill state, with a specific emphasis on the environment, forest conservation, drug menace (specifically "Chitta"), affairs related to tribal and archaeology and the unique challenges of governance in high-altitude regions. Recent Notable Articles (Late 2025) His recent reporting highlights the critical intersection of policy, law, and social safety in Himachal Pradesh: 1. "Himachal’s battle against Chitta: Why the border areas are most vulnerable" (Late 2025): An investigative look at the transit routes from Punjab and the impact on local youth. 2. "Shimla ropeway clears key hurdle as 820 trees face the axe :According to the Forest Survey of India’s 2021 assessment, 47.21 percent of Shimla’s 5,131 sq km geographical area is under forest cover (Nov 17, 2025). 3. "Himachal to handover 2.7427 ha of non-forest land for Shimla Ropeway: Given the land’s non-forest nature, RTDC and the state will not require permission from MoEFCC" (Nov 18, 2025) 4. "How the centuries-old Jodidara tradition is fading in Himachal’s Trans-Giri region: Jodidara: a form of fraternal polyandry—has long been part of Hatti tribal culture in the Trans-Giri region of Himachal Pradesh and adjoining Uttarakhand. It is believed to have evolved to prevent division of ancestral land and maintain unity among brothers in the harsh, mountainous terrain" (Aug 18, 2025) Legal & Agricultural Affairs "Kisan Sabha hails SC’s setting aside Himachal HC order to remove orchards from forest land" (Dec 18, 2025): Covering a major Supreme Court victory for farmers, where a High Court order to remove fruit-bearing apple orchards was overturned. "Himachal Cabinet nod to new tourism policy; focus on home-stays in tribal areas" (Dec 11, 2025): Detailing the legislative push to decentralize tourism and bring economic benefits to Lahaul-Spiti and Kinnaur. 3. Governance & Environment "Forest rights and development: Why Himachal is seeking more leeway from Centre" (Dec 19, 2025): Reporting on the legal hurdles faced by the state in infrastructure projects due to the Forest Conservation Act. "Cloudbursts and resilience: How Himachal’s remote villages are building back better" (Nov 2025): Following up on the long-term rehabilitation efforts after monsoon-related disasters. Crime especially cyber crimes, crypto currency etc: crypto currency: "Agents in uniform, motivational speeches, lavish parties: How a Himachal crypto con went unnoticed:A serial conman, a ‘Nelson Mandela Nobel Peace Award winner', and retired policemen got together to pull off a Rs 1,740-crore fraud" (Nov 10, 2023) Signature Beats Saurabh is recognized for his tenacious reporting on the state's drug epidemic. His deep familiarity with the topography and tribal culture of Himachal allows him to report from remote locations like Spiti, Pangi, Shillai, which are often overlooked by national media. His legal expertise makes him a primary choice for covering the Himachal Pradesh High Court on issues ranging from local body elections to environmental PILs. X (Twitter): @saurabh_prashar . ... Read More

Stay updated with the latest - Click here to follow us on Instagram

Tags:
Shimla

Loading Recommendations...

Mar 06: Latest News

Live Blog