Himachal Pradesh Government Hospitals Earning Just ₹37 Lakh from Medicine Shops, Experts Flag Major Revenue Loss

A concerning financial trend has emerged from Himachal Pradesh’s government hospitals, where medicine shops operating within premises are generating surprisingly low rental income, sparking debate over inefficiencies in the current system.

According to data accessed through the Right to Information (RTI) Act, 42 pharmacy outlets across government medical colleges and hospitals collectively contributed just ₹47.35 lakh in rent in 2022–23, a figure that dropped further to ₹37.29 lakh in 2023–24.

What makes the situation more striking is the comparison with a single food canteen at the Atal Institute of Medical Super Specialties (AIMSS), Chamyana, near Shimla. The canteen alone pays ₹32 lakh annually, nearly matching the combined rent from all 42 medicine shops.

📉 Why Are Earnings So Low?

These pharmacy outlets are currently operated by the Civil Supplies Corporation under long-term agreements with hospitals. However, critics argue that the existing rent model is outdated and highly undervalued.

At present, rent is calculated at just 0.2% of annual turnover, while in some cases like IGMC Shimla, it is slightly higher at 1%. Experts say such rates fail to reflect the real commercial potential of these high-footfall hospital spaces.

💡 Comparison Raises Serious Questions

The issue becomes even more evident when compared to PGI Chandigarh, where just nine pharmacy shops generate a staggering ₹18.2 crore annually in rent—thanks to an open and competitive bidding system.

The AIMSS Chamyana Faculty Association (ACFA) has strongly recommended adopting a similar model in Himachal Pradesh. In a memorandum to the state’s Finance Secretary, the association highlighted the “massive untapped revenue potential” being lost due to the current setup.

🗣️ Experts Speak

Dr. Yashwant Verma, Secretary of ACFA, who obtained the data via RTI, questioned the efficiency of the system.

“The current model is not benefiting anyone—neither hospitals, nor patients, nor even the Civil Supplies Corporation,” he said.

He further pointed out that the corporation reported profits of ₹5.73 crore in 2022–23 and ₹5.34 crore in 2023–24, reflecting margins of just over 8%. “Given the scale of operations and low rent, these returns are relatively modest,” he added.

💊 Patients Not Getting Best Deals Either

Despite paying minimal rent, these shops offer only 10% discount on medicines and 30% on surgical items.

In contrast, pharmacy outlets at PGI Chandigarh offer at least 15% discount on medicines, even while paying significantly higher rents—raising concerns about whether patients in Himachal are getting fair benefits.

🏥 Corporation Defends Model

A senior official from the Civil Supplies Corporation acknowledged the low rent but defended the arrangement, citing additional support provided to hospitals.

“We extend credit facilities worth nearly ₹30 crore and ensure 24×7 availability of medicines,” the official said.

⚠️ Call for Reform Amid Financial Stress

With Himachal Pradesh facing financial challenges, experts believe that restructuring the allotment system through open bidding could significantly boost hospital revenues.

The ACFA has gone a step further, calling the existing outlets “under-performers” and recommending cancellation of current licences. It has urged the government to re-allot all shops through a transparent bidding process.

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