Himachal defends move to impose water cess, proposes to share revenue from BBMB projects with other states

Jal Shakti Minister Mukesh Agnihotri says as per constitutional provisions, water is a state subject, giving right to Himachal over its water resources

Chief Minister Sukhvinder Singh Sukhu during the Budget Session of HP Vidhan Sabha in Shimla on Wednesday. Tribune photo

Tribune News Service

Shimla, March 22

Defending its move to impose water cess to generate resources, Himachal Government on Wednesday said it was well within its right under theInter State River Water Disputes Act 1956 to impose the cess on hydel-power generation.

Responding to action by its neighbours, Punjab and Haryana, who moved resolutions in their assemblies today, seeking withdrawal of the water cess, Jal Shakti Minister Mukesh Agnihotri said as per constitutional provisions, water is a state subject, giving right to Himachal over its water resources.

“The revenue generated from imposition of water cess on BBMB projects shall be distributed equally among all five states, including Himachal, as Bhakra Nangal project is a joint venture of Rajasthan, Punjab, Haryana, HP, Delhi and Chandigarh,” said Agnihotri. He also clarified the position on the Shanan hydro project, which he said will be transferred to Himachal from Punjab after March 2024 in accordance with the period of validity of lease agreement.

He also said the 7.19 per cent share that Himachal was getting from BBMB projects was its legitimate right, as per Supreme Court order. “The BBMB projects utilize the water and land of Himachal,” he stated.

Himachal assembly had passed theHimachal Pradesh Water Cess on Hydropower Generation Bill, 2023 on March 16. The government is hoping to generate revenue of Rs 4,000 crore by imposing the cess onon 172 projects with a capacity of 10,991 MW.

“There is no bar on imposition of water cess under Section 7 of the Act. The cess does not involve any dispute regarding interstate release of quantum of water as the volume of water being released to the two states will not get affected,” said Agnihotri.

“We have imposed water cess on the same analogy as the governments of Uttarakhand and Jammu and Kashmir, as the State has the right to impose any tax on usage of water, which is state subject. He also said that the cess has bene imposed for non-consumptive use of water for hydro-power generation by projects located within Himachal.”

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