New Delhi [India], January 29 (HBTV): Odisha has secured the top position in fiscal health among 18 major states, with a cumulative score of 67.8, followed by Chhattisgarh (55.2) and Goa (53.6), according to the inaugural issue of NITI Aayog's Fiscal Health Index (FHI) 2025.

Arvind Panagariya, Chairman of the 16th Finance Commission, launched the report in New Delhi on Friday.

The report provides a comprehensive assessment of the fiscal health of 18 major states based on five key sub-indices: quality of expenditure, revenue mobilisation, fiscal prudence, debt index, and debt sustainability. It also offers insights into state-specific challenges and areas for improvement.

The Fiscal Health Index (FHI) aims to highlight the fiscal status at the sub-national level and guide policy reforms for sustainable and resilient economic growth.

States ranked as top achievers in the index demonstrate strong fiscal health, excelling in revenue mobilisation, expenditure management, and debt sustainability. Meanwhile, states such as Jharkhand have shown improvement in fiscal prudence and debt sustainability, while Karnataka has seen a decline due to weaker performance in expenditure quality and debt management. These disparities underline the need for targeted reforms to address specific fiscal challenges and ensure sustainable growth.

While launching the report, Panagariya emphasised the importance of states following a stable fiscal path to achieve balanced regional development, long-term fiscal sustainability, and prudent governance.

He stated that the Fiscal Health Index (FHI) provides a systematic approach to measuring state-level fiscal performance, offering valuable insights into broader fiscal trends and enhancing the understanding of fiscal health across the country.

Panagariya further highlighted that the FHI report promotes an integrated approach to fiscal health and sustainable growth, reinforcing the shared responsibility of both central and state governments in achieving national prosperity.

The report also marks the launch of an annual series aimed at providing data-driven insights into the fiscal health of India's states, fostering informed decision-making and policy interventions. The FHI is designed to assist policymakers by identifying areas requiring intervention and strategic planning.  

(ANI)