Fiscal Health Index 2025

Fiscal Health Index 2025: The Fiscal Health Index (FHI) was recently released.

• About: Fiscal Health Index (FHI) is an initiative by NITI Aayog to assess the fiscal health of states in India.

o Covers 18 major states contributing significantly to GDP, demography, public expenditure, revenue, and fiscal stability.

o Odisha leads the Index, followed by Chhattisgarh, Goa, Jharkhand, and Gujarat.

o States manage two-thirds of public spending and one-third of total revenue, making their fiscal performance crucial for national economic stability.

o Based on data from the Comptroller and Auditor General of India (CAG) for FY 2022-23.

• Objectives: To provide a comparative analysis of fiscal health across states.
• Key Indicators Evaluated: Tax Buoyancy → Revenue Generation and Mobilization → Debt-to-GSDP Ratio → Expenditure Management and Prioritization → Debt Management → Fiscal Deficit Management → Overall Fiscal Sustainability