Political analysts believe that the announcement will go a long way in strengthening Congress for the next general elections as Gairsain has been a major emotive issue with a large section of those who fought for Uttarakhand favouring Chamoli district as the permanent capital of the hill state.
The ruling Congress has taken a lead over the opposition by striking an emotional chord with the hill people with the announcement as BJP despite being in the saddle for seven out of 12 years of the state's existence is charged with not acting on the sensitive issue.
It is the first government in the 12-year-old state which has moved on the issue and this is sure to have an impact on the minds of the hill people, they held.
The move would initiate the process of infrastructure building there and may pave the way for its gradual emergence at least as the summer capital of the state if not a permanent one, they said.
Congress insiders requesting anonymity even suggested that Bahuguna's next announcement may be declaring Gairsain as the state's summer capital before 2014 Lok Sabha polls if the Vidhan Bhawan building and related infrastructure comes up there on time.
The decision also appears to have been prompted by Congress' defeat at the hands of BJP in the bypoll to Tehri Lok Sabha seat in the hills where Chief Minister's son Saket Bahuguna lost to Mala Rajya Laxmi Shah of BJP by more than 22,000 votes. (MORE)