India, March 2 -- The abrupt discontinuation of Revenue Deficit Grant (RDG) based on the 16th Finance Commission's (FC) recommendation has shocked most hill states, particularly Himachal Pradesh. A careful reading of chapter nine of the FC report reveals that all states, including special category hill states, have been treated alike. The reasons for this departure from established principle are general rather than state-specific, as are the calculations. This not only runs contrary to Article 275(1) of the Constitution but also ignores the structural disabilities of states like Himachal Pradesh.

RDG is not charity; it is a response to objective reality. These states possess difficult terrain, low population density, large tribal populat...