The history of the state has been as old as that of mankind, as evident from the archeological finds in Shivaliks of more than a million-year-old Ramapithecus fossils and half-a-million year-old palaeolithic tools.

The present-day Himachal Pradesh was formed by merging two types of states — the one ruled by native princess which saw the Praja Mandal movement and the other states which were directly under the British administration and joined the union in 1966.

Himachal Pradesh became a centrally administered territory on April 15, 1948, with the integration of 30 small princely states. Only five of these states had some size to speak of. Thirteen of the states were less than 100 square miles, while three of them were even than ten square miles.

Dr Y.S. Parmar, who later became the state’s first CM, waged a relentless battle inside and outside Parliament for democratisation of the administration. Ultimately the Government of Part C States Act was passed to provide for a democratic government of a limited character in the state. Subsequently, a 36-member Vidhan Sabha was created. Elections to it were held in November, 1951.

The state had been singularly fortunate to have a visionary like Dr Parmar at the driver’s seat in the newly formed state. He laid a sound foundation for the state’s development which ultimately helped it to emerge as a model for development of hill areas. He was able get the First Five Year Plan, which was already under way, reoriented to accord top priority to road construction. He ensured that a bulk of the Plan funds, more than 50 per cent, were spent for laying new roads. At the end of the Plan, the length of motorable roads had increased from 280 km to 717 km and that of "jeepable" roads from 298 km to 1,843 km.

The three decades of statehood have seen tremendous development on all fronts, mainly due to the fact that Himachal Pradesh has largely remained a highly stable political entity. The state had remained free from the Aya Ram, Gaya Ram culture, with only one instance of mass defection in the wake of the collapse of Janata government at the Centre.

The progress made by the state in these three decades is reflected in the socio-economic indicators. The per capita income has shot up from Rs 240 in 1948 to Rs 12,692 at the turn of the century; the literacy percentage from 7.1 to 90 (94 for men and 86 for women); the length of motorable road from 288 km to 21,474 km; the agriculture production from 1.99 lakh tonnes to 17 lakh tonnes; horticulture output from a meagre 1200 tonnes to 4.92 lakh tonnes; and the annual power production has increased from 398 to 2527 million units.

The most spectacular achievement has been in the field of education. Himachal Pradesh is one of the few states in the country that has made primary education compulsory. It ensures almost 100 per cent enrolment of children in primary schools. The number of educational institutions has increased from 331 in 1948 to 13,892. This figure includes three universities, 37 colleges, two medical colleges, four dental colleges, one regional engineering college, six polytechnics and 34 industrial training institutes. Effort is now towards achieving universalisation of elementary education.

Much has been done in the health sector too with the number of institutions serving the people in remote areas rising from a meagre 88 to 3763. The life expectancy for males has gone up to 65 years as against the national figure of 62.4 years, while for females it is 65.5 years, three years more than the national figure. The birth rate has been brought down from 37.3 per thousand in 1971 to 22.6 in 1998, which was lower than the 27.2 per thousand for the country.

The most significant development which has brought prosperity to people is the growth of tourism industry. While there were hardly any hotels in 1948, the state today has over 1300 hotels with about 500 hotels in and around Manali alone. The hotel industry, which had so far concentrated around important tourist places like Shimla, Dalhousie and Dharamsala, is now making efforts to bring lesser known places on the tourism map.

The tourism boom, however, has come with a mixed blessing. It has led to haphazard growth of towns, traffic congestion, pollution, water shortage and insanitation. All this does not augur well for the future of the industry. Its most ominous fallout has been the increase in drug trafficking, particularly in the Kulu valley, where foreigners have been allegedly involved in the illegal cultivation and smuggling of charas. The spread of drug culture amongst the youth is a matter of utmost concern for the agencies maintaining law and order and for society at large as it would spell doom for this peaceful state with a rich culture.

Similarly, while the extension of road network to the interior areas has opened new vistas of economic growth and development, it has also proved disastrous for the green cover. A complete ban was imposed on felling trees as late as 1983, when much harm had already been done. As per the national forest policy, at least 60 per cent of the area in hills has to be under forest cover, but in Himachal the cover is only 23 per cent.

The destruction of green cover has already started telling upon the fragile Himalayan ecology with snow becoming increasingly scarce and cloudbursts and flash floods becoming a regular feature. Protecting the hill environment is, thus, a major challenge for the state as a failure to do so will affect tourism and hydel generation.

The state’s grandiose plans to harness 10,000 mw of hydel power over the next 10 years will come to nought if the discharge in the snow-fed rivers continues to decline. The Dhumal government has begun work on hydel projects on a war-footing. The hydel projects, with an aggregate generation capacity of 6,000 mw, include the prestigious Parbati, Kol and Chamera-II projects. Besides, over 300 micro-hydel projects have also been assigned to the private sector. Once completed, these projects will fetch the much-needed revenue to the state.

The government has now selected two new areas — information technology and biotechnology — to rid the state of its financial crisis. A comprehensive plan has been prepared in collaboration with NASSCOM (National association of software companies) to promote software industry with an export target of Rs 2000 crore by 2005. A software park will be set up in Shimla and an information technology institute of international standard is being set up at Vaknaghat. Computer education is also being introduced in 135 government senior secondary schools.

Ironically, the state which has been doing well on the development front and the social sector, has been in a financial mess. With successive regimes using employment in government as the sole instrument for satisfying the aspirations of people, the state today has almost 5 per cent of the population in government jobs, the highest in the country. Worse, instead of mobilising resources to meet the growing expenditure, the government raised loans indiscriminately, plunging the state into a debt trap.

The gravity of the situation can be gauged from the fact that the state’s annual revenue from its own resources is only about Rs 750 crore, whereas the interest liability has crossed the Rs 1,000 crore mark. At present, the monthly inflow, including Central grants, is Rs 200 crore, whereas the outflow is Rs 400 crore, leaving the state with no option but to raise more loans.

The present government has initiated some fiscal reforms like downsizing the administration, levying user charges, etc, but these will not have any immediate impact.