Published: 12 March 2026NITI Aayog / PIBGovernance

NITI Aayog Releases Second Annual Fiscal Health Index 2026: Odisha Tops Rankings, Rajasthan in 'Performer' Category

AQuick answer

NITI Aayog's Fiscal Health Index 2026 (released March 11, 2026) ranked Odisha first among major states for the second year running (score 73.1). Rajasthan is classified as a 'Performer', reflecting improved quality of expenditure but continuing structural fiscal challenges.

Key facts

NITI Aayog released the second annual Fiscal Health Index (FHI) 2026 on March 13, 2026, ranking 18 major states on 5 parameters: revenue mobilisation, expenditure quality, fiscal prudence, debt sustainability, and economic buoyancy.
Odisha topped the rankings for the second consecutive year with a score of 73.1, followed by Goa and Jharkhand.
Rajasthan is classified in the 'Performer' category, indicating moderate fiscal management with improved expenditure quality but persistent structural challenges.
Key concerns for Rajasthan include high committed expenditure (salaries, pensions, interest payments) and revenue deficit.
FHI 2026 was developed under the Fifteenth Finance Commission framework to encourage states to improve fiscal discipline.
The index is used by the central government to assess states' eligibility for performance-linked grants and borrowing headroom.

NITI Aayog released the second annual edition of the Fiscal Health Index (FHI) 2026 on March 11, 2026, evaluating the fiscal performance of 18 major Indian states and 10 North-Eastern and Himalayan states for FY 2023–24. The index is built on five pillars: Quality of Expenditure, Revenue Mobilisation, Fiscal Prudence, Debt Index, and Debt Sustainability. Data is sourced from Comptroller and Auditor General (CAG) audited state accounts.

Among major states, Odisha ranked first (Score: 73.1) for the second consecutive year, attributed to its fiscal deficit staying within the 3% FRBM norm, a declining debt-to-GSDP ratio, and high capital outlay on infrastructure, health, and education. Goa ranked second (54.7) and Jharkhand third (50.5). States are categorised into four tiers: Achievers (Odisha, Goa, Jharkhand), Front Runners (Gujarat, Maharashtra, Chhattisgarh, Telangana, UP, Karnataka), Performers (MP, Haryana, Bihar, Tamil Nadu, Rajasthan), and Aspirational (Kerala, West Bengal, Andhra Pradesh, Punjab).

Rajasthan is classified as a 'Performer' state, reflecting improvement in its quality of expenditure in FY 2023–24. However, Rajasthan continues to face structural challenges including high revenue deficits, subsidy-heavy expenditure, and debt accumulation. The index underscores the need for states to improve own tax revenue mobilisation and reduce committed expenditure in the form of salaries, pensions, and interest payments.

Mains angle

Q: Examine the five pillars of NITI Aayog's Fiscal Health Index 2026 and evaluate Rajasthan's 'Performer' classification.

Answer (50 words):

NITI Aayog released Fiscal Health Index 2026 on March 13, assessing 18 states on quality of expenditure, revenue mobilisation, fiscal prudence, debt index and debt sustainability using CAG-audited data. Odisha topped with 73.1 for the second year. Rajasthan was classified a 'Performer', reflecting improving expenditure quality but persistent revenue deficits.

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Fiscal Federalism & Finance CommissionIndian EconomyMonetary & Fiscal PolicyIndian EconomyMacro Overview & State BudgetEconomy of Rajasthan

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CoverageNationalSubjectEconomicExamBasic Computer Instructor · CET Graduation · CET Senior Secondary · EO/RO · LDC · Mahila Supervisor · Patwar · PTI · RAS · REET · RPSC SI · School Lecturer · Senior Computer Instructor · Senior Teacher · UPSC · Vanpal · BothSourceNITI Aayog / PIB

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TEconomy of Rajasthan TMonetary & Fiscal Policy TFiscal Federalism & Finance Commission

Practice MCQ from this story

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Linked questionMedium

What score did Odisha achieve to top NITI Aayog's Fiscal Health Index 2026 among major states?

A82.5CorrectIncorrect

B73.1CorrectIncorrect

C65.4CorrectIncorrect

D54.7CorrectIncorrect

Explanation · Correct answer B

Odisha ranked first with a score of 73.1 for the second consecutive year, attributed to its fiscal deficit staying within the 3% FRBM norm, declining debt-to-GSDP ratio, and high capital outlay on infrastructure, health, and education. Goa ranked second (54.7) and Jharkhand third (50.5).

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Frequently asked questions

Which state topped the NITI Aayog Fiscal Health Index 2026, and what was its score?

Odisha topped the Fiscal Health Index 2026 for the second consecutive year with a score of 73.1, followed by Chhattisgarh and Goa.

On how many parameters are states ranked in the Fiscal Health Index, and what are they?

States are ranked on 5 parameters: revenue mobilisation, expenditure quality, fiscal prudence, debt sustainability, and economic buoyancy.

In which category was Rajasthan placed in the Fiscal Health Index 2026, and what are its key fiscal concerns?

Rajasthan was placed in the 'Performer' category, reflecting improved expenditure quality but persistent structural challenges including high committed expenditure on salaries, pensions, and interest payments, along with a revenue deficit.

Under which Finance Commission framework was the Fiscal Health Index developed, and what is its purpose?

The FHI was developed under the Fifteenth Finance Commission framework to encourage states to improve fiscal discipline. The central government uses it to assess states' eligibility for performance-linked grants and borrowing headroom.

When was the second annual Fiscal Health Index 2026 released, and how many major states were ranked?

NITI Aayog released the second annual Fiscal Health Index 2026 on March 13, 2026, ranking 18 major states.

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