Fiscal Health Index

Fiscal Health Index Latest News

Recently, the NITI Aayog released the second annual edition of the “Fiscal Health Index 2026” in New Delhi.

About Fiscal Health Index

• It was introduced by NITI Aayog, provides a systematic framework to evaluate the fiscal performance of 18 major Indian states, 10 North-Eastern and Himalayan states.
• It provides a comprehensive and comparable assessment of the fiscal performance of Indian states.
• The Index has been designed as a data-driven framework to evaluate fiscal soundness, guide reforms, and promote evidence-based fiscal policymaking across states.
• It is built on five key pillars of fiscal health: Quality of Expenditure, Revenue Mobilisation, Fiscal Prudence, Debt Index, and Debt Sustainability.
• The index classifies states into four tiers.
  • Achievers: These are states with strong fiscal discipline, high own-tax revenues, low deficits, and manageable debt;
  • Front Runners: These states maintain broadly sound finances but fall short of the top tier on one or more indicators;
  • Performers: They occupy the middle ground, with mixed results across the five pillars.
  • Aspirational: These states are those facing the most significant fiscal stress, characterised by persistent deficits, high debt, and limited revenue capacity. 

Key Highlights of Fiscal Health Index (FHI) 2026

• Odisha, Goa and Jharkhand have been categorised as achievers.
• Karnataka and Telangana moved from front runner to performer, and Kerala and Tamil Nadu slipped further to the aspirational group.
• Among northeastern and Himalayan states, Arunachal Pradesh has topped in the index, followed by Uttarakhand, Tripura, Meghalaya, Assam and Mizoram.

Source: PIB

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