'Biggest Diwali Gift': After Six-Decade Legal Battle, CM Sukhu Secures Himachal's BBMB Share

Marking the end of a six-decade-long inter-state power-sharing struggle for its rightful dues in the Bhakra-Nangal and Beas hydroelectric projects, the Supreme Court has ordered the Punjab and Haryana governments to give Himachal Pradesh 11,973 million units (MU) of power arrears over the next 20 years.

The order, passed by a bench headed by Chief Justice Surya Kant, along with Justices Joymalya Bagchi and V. Mohana, gives effect to the apex court’s November 2011 judgment, which recognised Himachal Pradesh’s entitlement to a 7.19% power share in the BBMB projects since November 1, 1966.

The state will receive an immediate benefit of Rs 500-600 crore per annum, which could grow to Rs 1,000 crore and more over the next two to three years, a big relief for a resource-starved state facing a massive cut in central grants, the complete phasing out of GST compensation, and the stoppage of the Revenue Deficit Grant (RDG).

Politically, too, Chief Minister Sukhvinder Singh Sukhu finds himself at an advantage ahead of next year’s state Assembly polls, as he has consistently tried to build his image as a politician relentlessly fighting to secure the state's share in hydel projects and strengthen its financial health to accelerate the pace of development.

On Saturday, as he returned to Shimla after a three-day tour of Chamba and Delhi, Sukhu termed the verdict the “biggest Diwali gift” to the 75 lakh people of Himachal Pradesh. He said the state had fought a long legal battle to secure its legitimate share, a case that his government had vigorously pursued in the Supreme Court.

“Had Himachal Pradesh been ruled by a double-engine BJP government, this battle would neither have been pursued with such vigour nor won. The BJP leadership has never shown the seriousness or sincerity needed to secure the state’s rightful dues from the Centre or neighbouring states,” he said.

Power Arrears To Bring Annual Revenue

The state will receive approximately 598 million units (60 crore units) per annum, specifically targeted for delivery during the high-demand lean season (October to March).

State Advocate General Anup Kumar Rattan put the revenue earned from this breakthrough at between Rs 800 crore and Rs 1,000 crore annually if the power is sold at higher rates. The state government is already selling its power to Rajasthan, Kerala and Tamil Nadu at Rs 15.50, Rs 14.50 and Rs 13.50 per unit, respectively.

Sukhu also endorsed this view, saying, “I will see that I get the best market rates for selling the surplus power share received from the BBMB and other hydel projects in the state.”

A Larger Political Strategy

But behind the verdict is also a larger political strategy by Himachal Pradesh to strengthen its negotiating power with the Centre and states in the region on sharing river water and power from hydel projects located within the state’s territory.

A memorandum of understanding (MoU) signed on the Kishau Multipurpose Project in the presence of Union Home Minister Amit Shah by six states, Haryana, Delhi, Rajasthan, Uttarakhand, Uttar Pradesh and Himachal Pradesh — in September this year was also a trigger point and set the stage for bringing the curtain down on the long struggle for a rightful share.

“I had made it a precondition before signing the MoU on the Kishau project. Haryana must file an affidavit in the Supreme Court supporting Himachal Pradesh’s claim in the BBMB. I knew Haryana needed both water from the Kishau project and power. But Punjab continued to oppose our stand. That is why the Supreme Court has pointed to Punjab’s role in the unavoidable stalemate in the settlement of this long-pending inter-state dispute,” he told Outlook exclusively.

Finally, Haryana, in its affidavit, had agreed to clear its outstanding BBMB dues in favour of Himachal Pradesh. This helped in reaching a non-cash settlement framework in the apex court. Now, all the arrears will be paid in the form of electricity over the next two decades.

This is seen as a great moral victory for Himachal Pradesh.

Sukhu's Other Legal Battles

Now, Sukhu wants to carry forward his struggle to secure the state's legitimate rights in the 110 MW Shanan hydel project, located in Himachal Pradesh but managed by the Punjab Electricity Board, despite its 99-year-old lease having already expired in 2024.

Earlier, due to his efforts, the Himachal Pradesh government took over ownership of the Oberoi Group's luxury heritage resort, Wildflower Hall, after fighting a protracted legal battle that had been going on for 23 years.

Another significant legal battle, first in the High Court and later in the Supreme Court, was also won against M/s JSW (Jindal Steel & Power) over the Karcham-Wangtoo Project to secure a higher share of power, increasing it from 12% free power to 18%. This translates into a benefit of Rs 150 crore per annum.

The signing of the Kishau Multipurpose Project agreement will benefit Himachal Pradesh by Rs 600-800 crore per annum without the state having to invest in the project.

A Six-Decade-Long Legal Battle

Originally, the Himachal Pradesh government had filed its case in the Supreme Court in 1996, when Virbhadra Singh was Chief Minister. The verdict acknowledging the state's lawful right to a 7.19% share, enforceable under the Punjab Reorganisation Act, 1966, was delivered in 2011, when Prem Kumar Dhumal was Chief Minister.

Though the BBMB had started releasing the state's share of power on a real-time basis after this verdict, both Haryana and Punjab did not agree to pay the arrears. This compelled Himachal Pradesh to wage another legal and political battle, which has now found a final settlement.

The Chief Minister expressed confidence that continued efforts to secure the rightful value of the state's natural resources and protect its rights would help Himachal Pradesh become the most prosperous and happiest state in the country by 2032.

The Leader of the Opposition, Jairam Thakur, on the other hand, said the Narendra Modi government and the intervention of the Attorney General had played an important role in resolving the long-pending dispute. Sukhu cannot take credit for this alone. It is the result of institutional continuity and the collective contributions of earlier governments.

Former Chief Minister Prem Kumar Dhumal, during whose tenure the apex court had ruled in 2011 in favour of a 7.19% share for the state, said Himachal Pradesh had finally received its rightful share.

“As for the various state governments, each deserves credit for whatever work they accomplished during their respective tenures. However, the true credit and congratulations belong to the people of Himachal Pradesh,” he said.