Odisha retained its top position in the latest Fiscal Health Index (FHI) 2026 released by NITI Aayog, securing an overall score of 73.1. The state also improved its score from the previous year, reinforcing its lead in fiscal management among India’s major states. Goa and Jharkhand follow in the rankings, emerging alongside Odisha in the group of top “Achiever” states.
Gujarat and Maharashtra continue to feature among the top five performers, reflecting relatively stable fiscal fundamentals. Haryana recorded a notable improvement, climbing three positions compared with the previous year. Bihar, Karnataka and Telangana showed signs of mild recovery, while Punjab, West Bengal and Kerala remained at the bottom of the rankings.
The index, which evaluates the fiscal position of 18 major states, shows varied outcomes across the country. While some states experienced moderation in their FHI scores in 2023–24 compared with 2022–23, the overall assessment highlights differences in revenue mobilisation, expenditure management and debt sustainability.
Fiscal Prudence in Practice
States in the Achiever category—Odisha, Goa and Jharkhand—share several fiscal strengths. These include a high share of own tax revenue, generally exceeding 60%, capital expenditure of around 4–5% of Gross State Domestic Product (GSDP), fiscal deficits kept below 3% of GSDP, moderate debt levels under 25% of GSDP and relatively manageable interest burdens.
Odisha’s fiscal deficit stood at 1.73% of GSDP in 2023–24. Its debt-to-GSDP ratio declined from 23.46% in 2019–20 to 14.39% in 2023–24, suggesting that economic expansion has outpaced debt accumulation. Interest payments have also eased considerably, falling from 5.97% of revenue receipts in 2019–20 to 2.88% in 2023–24, indicating reduced pressure on the state’s revenues.
In contrast, Punjab continues to face significant fiscal stress. The state’s total liabilities increased from Rs 2.29 lakh crore in 2019–20 to Rs 3.55 lakh crore in 2023–24—an expansion of more than Rs 1.25 lakh crore over five years. Despite steady growth in GSDP, liabilities remained elevated at around 43–48% of GSDP.
Managing Debt Trajectories
With states accounting for nearly one-third of India’s general government debt, their fiscal trajectory has important implications for overall macroeconomic stability. The Fiscal Health Index aims to provide a comparative assessment of state finances, enabling benchmarking and identifying areas that require policy attention. Key priorities highlighted in the report include strengthening own-tax revenues, rationalising committed expenditure, improving the quality of capital spending and adopting medium-term fiscal planning frameworks. The report also stresses the need for stronger public financial management systems, greater transparency in fiscal data and closer monitoring of off-budget borrowings.