The Heartbeat of the Hills: Can Himachal Save Its Local Lifeline?
This is not just a story about a crisis in Himachal Pradesh. It’s the story of a profound choice: what kind of future will this beloved hill state choose? The recent plea from the hospitality association for loan relief is not merely a financial request. It is a distress signal from the very circulatory system of Himachal’s economy, now on the brink of failure.
Imagine a family in Shimla. They poured their life savings into a 12-room guesthouse. Their entire year—loan repayments, salaries, maintenance—hinges on the summer tourist season. But this year, that season never came. First, the Kumbh Mela diverted the usual crowds. Then, the disruption of Operation Sindoor froze remaining travel plans. Finally, a state-declared natural disaster severed roads and wiped out the last few bookings. The family’s dream now teeters on collapse.
This isn’t a tale of poor planning. It’s the harsh reality of a seasonal economy. And this single story repeats itself thousands of times over—in small hotels, homestays, local cafés, and taxi services. When tourism stalls in Shimla, the pain radiates outward. It reaches the orchard worker, the milk producer, the artisan selling shawls, the part-time cleaner. These micro-enterprises are not side actors; they are the heartbeat of the hills, pumping earnings through countless local hands.
A Deeper Shift: From Public Good to Private Fortress
For decades, Himachal’s growth was nurtured by strong public investment—in roads, schools, and health systems. But fiscal policies over the last 30 years have drastically shrunk the state’s ability to invest. As the government retreated, private capital rushed in, but with a different model.
Contrast the family guesthouse with a large, asset-heavy corporate resort. The resort buys land, locks it for generations, and creates a narrow funnel of employment. Its economic ripple effect—the spread of money to local drivers, growers, and small shops—is comparatively thin. The guesthouse, however, is woven into the community: it sources food from nearby farms, hires local youth, and uses neighborhood services. Its capital doesn’t just sit on the land; it circulates, daily.
This is Himachal’s pivotal dilemma: Should it privilege capital that stays fixed in land for decades, or capital that circulates through thousands of local hands every single year?
Why Protecting the Small is the Smartest Economics
Supporting Medium and Small Enterprises (MSMEs) isn’t sentimentality; it’s sound economic logic. These small units absorb more local people, spread ownership, and build community resilience. When the state can no longer be the primary investor, its most critical job becomes protecting this existing “circulatory capital.”
The banking relief sought by hoteliers—an extension and inclusion for those hardest hit—is thus far more than a paperwork exercise. It is a vital one-time intervention to shield a distributed, inclusive model of development that large corporations alone cannot replicate.
The risk of inaction is a hollowed-out future: one of monumental hotels surrounded by struggling towns, concentrated land ownership alongside vanishing local enterprise, and long-term investments that return very little to the community.
Himachal is in transition. But this transition must not become a takeover. It must be a conscious choice—a choice to preserve the local, to circulate earnings, and to re-anchor sustainability in the fabric of everyday life.
Relief for these small stakeholders is urgent. But safeguarding the soul of Himachal’s economy is even more so. We must stand with the small not because it looks tiny on a balance sheet, but because it is what keeps the heart of the hills beating strong.
(By Tikender Singh Panwar, Former Deputy Mayor of Shimla Municipal Corporation)
