Odisha tops Niti Aayog's Fiscal Health Index, Chhattisgarh and Goa follows
Odisha Leads in Fiscal Health: NITI Aayog's 2025 Report
New Delhi, January 24: Odisha has emerged as the top state in fiscal health among 18 major states in India, according to the inaugural issue of NITI Aayog's "Fiscal Health Index (FHI) 2025." Odisha scored 67.8, followed by Chhattisgarh with 55.2 and Goa with 53.6. The report was launched by Arvind Panagariya, Chairman of the 16th Finance Commission, in New Delhi.
The report evaluates fiscal health based on five sub-indices: Quality of Expenditure, Revenue Mobilisation, Fiscal Prudence, Debt Index, and Debt Sustainability. It aims to highlight fiscal status at the sub-national level and guide policy reforms for sustainable economic growth.
States like Jharkhand have shown improvements in fiscal prudence and debt sustainability, while Karnataka has faced challenges in expenditure quality and debt management. These disparities underscore the need for targeted reforms to address specific fiscal challenges.
Panagariya emphasized the importance of a stable fiscal path for balanced regional development and long-term sustainability. The FHI report provides a systematic approach to measuring state-level fiscal performance and offers insights into broader fiscal trends.
This report marks the beginning of an annual series aimed at providing data-driven insights into the fiscal health of India's states, aiding policymakers in informed decision-making and strategic planning.
Doubts Revealed
Odisha
Odisha is a state located on the eastern coast of India. It is known for its rich cultural heritage and beautiful temples.
Fiscal Health
Fiscal health refers to how well a state or country manages its money, including how it earns, spends, and saves it. Good fiscal health means the state is financially stable and can support its people and projects.
NITI Aayog
NITI Aayog is a government think tank in India that helps plan and suggest policies for the country's development. It stands for National Institution for Transforming India.
2025 Report
The 2025 Report is a document created by NITI Aayog that looks at how well Indian states are managing their finances. It predicts and analyzes the fiscal health of states up to the year 2025.
Arvind Panagariya
Arvind Panagariya is an Indian-American economist who was the first Vice-Chairman of NITI Aayog. He is known for his work in economic policy and development.
Expenditure Quality
Expenditure quality refers to how effectively a state spends its money. It means spending money wisely on things that benefit the people, like education and healthcare.
Revenue Mobilization
Revenue mobilization is the process of collecting money, usually through taxes, that the government uses to fund public services and projects.
Fiscal Prudence
Fiscal prudence means being careful and wise in managing money, ensuring that spending does not exceed income, and saving for future needs.
Debt Sustainability
Debt sustainability means a state can manage its debt without facing financial trouble. It ensures that the state can pay back its loans without affecting its economy negatively.
Jharkhand
Jharkhand is a state in eastern India known for its forests, wildlife, and mineral resources. It is one of the states assessed in the report.
Karnataka
Karnataka is a state in southern India known for its technology industry and cultural heritage. It faces challenges in managing its finances according to the report.
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