HRTC Faces Massive Losses of Over ₹2,100 Crore, Struggles to Recover from Financial Strain

Shimla, March 19, 2025:
Himachal Pradesh Road Transport Corporation (HRTC) has found itself in a precarious financial situation, with its cumulative losses reaching a staggering ₹2,119.03 crore by March 31, 2024. The corporation, which plays a pivotal role in providing public transportation across the state, incurred a loss of ₹152.90 crore during the financial year 2023-24 alone. The alarming financial decline has raised concerns about the corporation’s sustainability and its ability to offer affordable and reliable services in the future.

Deputy Chief Minister and Transport Minister Mukesh Agnihotri, in a written response to a question posed by Bilaspur MLA Trilok Jamwal in the ongoing budget session of the Himachal Pradesh Legislative Assembly, revealed the troubling financial status of HRTC. He further added that while the annual accounts for the 2024-25 financial year are still being compiled, the corporation’s financial health remains deeply concerning, with no significant improvements expected in the near future.

The mounting losses have cast a shadow over HRTC’s ability to continue its operations without significant intervention from the state government. The corporation, which is responsible for a significant portion of public transport across the hill state, has been grappling with several challenges, including rising operational costs, outdated infrastructure, and a growing burden of pension liabilities for its retired employees.

Impact on Public Transportation and Services

Despite the financial strain, HRTC continues to provide essential services across Himachal Pradesh. However, the situation is becoming increasingly unsustainable, and the corporation may have to explore additional measures to stay afloat. The losses have also hindered the corporation’s capacity to upgrade its fleet and enhance passenger services, making it difficult to compete with private transport operators that often offer better and more cost-efficient services.

In the face of these losses, the government has taken a step to increase the fares of electric taxis operating under the “Ride with Pride” initiative in Shimla city. This increase in fare rates is intended to help alleviate some of the financial pressure on HRTC, although it has been decided that the price hike will not apply to senior citizens and patients traveling to the Indira Gandhi Medical College (IGMC) in Shimla. According to Agnihotri, the fare increase is a necessary step, as no hike in fares has been implemented for the electric taxis in the last two years, specifically until February 20, 2025.

The “Ride with Pride” electric taxi service was introduced in Shimla as an eco-friendly and accessible transportation option, particularly targeting tourists and locals who prefer a more sustainable mode of travel. However, as costs continue to rise, the challenge remains to balance the corporation’s financial viability while ensuring that these public services remain affordable for the common man, especially those who depend on them for daily commutes.

Government Measures to Address Financial Crisis

The state government has acknowledged the significant financial burden HRTC is under and has committed to exploring measures that could help revitalize the corporation. These measures may include restructuring the corporation’s debt, introducing efficiency reforms, and potentially increasing subsidies to offset the rising operational costs. Additionally, the state may need to focus on increasing revenue by exploring new sources of income, such as improving the performance of its cargo services and focusing on increasing ridership through better marketing strategies.

While the decision to raise fares for electric taxis may offer some relief, it highlights the ongoing struggle HRTC faces in managing its finances. The corporation’s ability to sustain its services, particularly in the context of its growing losses, remains uncertain.

Is There a Way Forward for HRTC?

As the corporation continues to grapple with its financial woes, the need for comprehensive reforms has never been more pressing. Experts suggest that HRTC must embrace technology, enhance its operational efficiency, and explore alternative revenue-generation methods to turn around its financial situation. Without these measures, the future of public transportation in Himachal Pradesh may face further challenges, leaving thousands of residents dependent on the struggling public transport system in limbo.

The state government’s commitment to addressing the financial crisis will be crucial in ensuring that HRTC remains a viable public service provider in the years to come. Whether these efforts will succeed in turning the corporation’s fortunes around remains to be seen.