NITI Aayog Launches “Fiscal Health Index 2025”; Odisha Tops State Rankings

New Delhi: Dr. Arvind Panagariya, Hon’ble Chairman of the 16th Finance Commission, launched the inaugural issue of NITI Aayog’s report titled “Fiscal Health Index (FHI) 2025” today in the presence of Suman Bery, Vice Chairman of NITI Aayog; Dr. Arvind Virmani, Member of NITI Aayog; and Shri B.V.R. Subrahmanyam, CEO of NITI Aayog, among other dignitaries. The report offers a comprehensive analysis of the fiscal health of 18 major states, based on five key sub-indices: Quality of Expenditure, Revenue Mobilization, Fiscal Prudence, Debt Index, and Debt Sustainability.

Odisha emerged as the top-performing state with a composite score of 67.8, followed by Chhattisgarh and Goa, which scored 55.2 and 53.6, respectively. While Odisha displayed exceptional performance in revenue mobilization, expenditure management, and debt sustainability, Chhattisgarh and Goa also demonstrated strong fiscal health. Jharkhand showed notable improvement in fiscal prudence and debt sustainability, whereas Karnataka experienced a decline due to weaker performance in expenditure quality and debt management. The report highlights these interstate disparities and underscores the need for targeted reforms to address specific fiscal challenges and promote balanced economic development.

During the launch, Dr. Panagariya stressed the importance of states adopting a stable fiscal path to ensure balanced regional development and long-term governance. He noted that the FHI provides a systematic and comprehensive approach to measuring fiscal performance and offers valuable insights into broader fiscal trends. He emphasized that collaboration between the Centre and states is crucial for achieving national prosperity and fostering sustainable economic growth.

Suman Bery highlighted that the FHI serves as a roadmap for fiscal consolidation, transparency, and effective resource management. He described it as more than a ranking system, calling it a tool designed to assess and improve the fiscal health of states. He added that the FHI framework helps align state-level strategies with national objectives, paving the way for economic resilience and sustainable development.

CEO B.V.R. Subrahmanyam remarked that the FHI is instrumental in aiding policymakers by providing an objective view of fiscal landscapes across states. He noted that the report’s actionable insights can guide strategic planning and interventions to strengthen fiscal resilience and promote inclusive growth. He also emphasized that the FHI fosters healthy competition among states, ensuring their contribution to the vision of a fiscally stable and prosperous India.

Dr. Arvind Virmani lauded the FHI report as a vital tool for reinforcing cooperative federalism. He stressed that fostering collaboration between the Centre and states is key to addressing regional disparities and driving holistic growth. He congratulated the team for developing a framework that underscores the shared responsibility of both levels of government in achieving the broader vision of “Viksit Bharat @2047.”