Sharma, who is a senior state leader, was chosen by party Chief Sonia Gandhi amid intense lobbying for the seat after majority of Uttarakhand Congress leaders appeared averse to the idea of an "outsider" being nominated.
The refrain of the state party leaders was that having a strong voice in Rajya Sabha from the state was important for Congress given the fact that opposition BJP holds all five Lok Sabha seats from Uttarakhand.
Reports had it that Congress leaders from outside the state in the race, included Shivraj Patil, Rajiv Shukla and Raj Babbar.
Bahuguna had to step down as CM to make way for Harish Rawat. He wanted a ticket for himself whereas his successor wanted it for one of his team members.
The lone Rajya Sabha seat fell vacant when BJP's Bhagat Singh Koshiyari was elected to Lok Sabha. November 10 is the last date for filing of nominations.