In 1851, the princely state of Chamba was approached by Lord Napier of Magdala. The British wished to establish a sanatorium for Europeans on the outer slopes of the Dhauladhar range. There, the sun shone warmly on scented forests of pine and oak, the air was crisp and invigorating, the scenery beautiful. Negotiations were carried on with the Raja of Chamba and in 1853, the plateau of Kathlog, Portreyn, Tehra and Bakrota were transferred to the Government of India against a compensation of Rs. 2000 to be paid as an annual tribute to Chamba state. On the recommendation of Sir Donald McLeod, the new sanatorium was named Dalhousie, after Lord Dalhousie, the first British Governor General of India. In 1866, the cantonment area of Balun was also taken over and remains a cantonment to this day.