On the occasion, he appealed to the people to contribute towards making Himachal free from drugs and promote organic farming.
The Governor said the Lavi Fair has its own historical importance and is famous not only for trading activities but also for its age old traditions.
He said the fair has remained an important trade fair between India and Tibet for centuries. Even today, the tradition is as vibrant as ever.
The fair will conclude on November 15.
The Lavi Fair dates back to the time when Raja Kehari Singh of Rampur Bushahr state signed a treaty to promote trade with Tibet.
Rampur, 120 km from Shimla, was once a major trade centre as it is located on the old silk route connecting Afghanistan, Tibet and Ladakh.
The traders from Tibet used to bring raw wool, herbs and leather products and take back wheat flour, rice, spices, butter, farm implements and livestock.
A three-day horse trade-cum-exhibition was organised before the beginning of the Lavi Fair.
The main attraction during the fair every year is the sale and purchase of Chamurthi horses an endangered species known as the 'ship of the cold desert'.
Being a surefooted animal, it is mainly used for transporting goods in the Himalayas.
The Chamurthi horse traces its origin to the Tibet region. In India, it is bred in the villages of Himachal Pradesh bordering China.
According to the livestock census, there are around 1,100 Chamurthi horses in Kinnaur and Lahaul and Spiti districts in the state.
( With inputs from IANS )