State Budgets • Public Finance • Economic Governance • Viksit Bharat Vision

Ranking India’s Fiscal Fitness — Odisha Tops Fiscal Health Index 2025

The Fiscal Health Index (FHI) 2025 presents a comprehensive evaluation of India’s state-level fiscal performance. By providing data-driven insights, it aims to enhance fiscal governance, encourage prudent policymaking, and build economic resilience across states.

🔍 What is the Fiscal Health Index?

The FHI 2025 assesses the fiscal condition of 18 major Indian states using five critical sub-indices:

• 🧾 Quality of Expenditure
• 📊 Revenue Mobilisation
• 💼 Fiscal Prudence
• 📉 Debt Index
• 📈 Debt Sustainability

These components are aggregated into a composite fiscal index, offering a snapshot of each state’s strengths and areas for improvement in public finance.

🏆 Top Performers

• Odisha takes the lead with a score of 67.8, showing consistent fiscal discipline and robust revenue practices.
• Chhattisgarh (55.2) and Goa (53.6) follow, earning praise for their balanced budgets and responsible expenditure strategies.

These states act as fiscal role models for others navigating budgetary pressures.

📉 States That Need Strengthening

• Jharkhand has made gains in fiscal prudence and debt sustainability, but requires sustained effort.
• Karnataka, despite its strong economy, has faced setbacks in expenditure quality and debt management — highlighting the need for reforms and recalibration.

🧭 Why the FHI Matters

The index is more than a scoreboard — it is a roadmap for fiscal consolidation. It promotes:

• Transparency in public spending
• Better resource prioritisation
• Accountability in budget practices

It encourages states to adopt reforms that align with national fiscal goals and the Viksit Bharat @2047 vision.

🤝 Cooperative Federalism in Action

FHI 2025 reaffirms that cooperative federalism is key to overcoming regional disparities. States and the Centre must work collaboratively to ensure sustainable economic growth across the country.

🔮 Looking Ahead

With fiscal health being central to long-term development, the FHI serves as a tool for reflection, reform, and resurgence. It inspires healthy competition among states — a race not of numbers, but of governance excellence.