NITI Aayog released the second annual edition of the Fiscal Health Index (FHI) 2026, covering state finances for the financial year 2023-24. The report was unveiled in New Delhi by Suman Bery, Vice-Chairman of NITI Aayog. For the first time, the Index evaluates not only the 18 General Category States but also a separate group of 10 North-Eastern and Himalayan States, making the assessment more inclusive of India's fiscal diversity. The Index is built on five key pillars: Quality of Expenditure, Revenue Mobilisation, Fiscal Prudence, Debt Index, and Debt Sustainability. It uses audited data from the Comptroller and Auditor General (CAG) to ensure transparency and rigour. Odisha has emerged as the top-ranked state in FHI 2026 among major states for the second consecutive year, scoring 73.1. The top six states in the major-states category are Odisha, Goa, Jharkhand, Gujarat, Maharashtra, and Chhattisgarh. Punjab and West Bengal are at the bottom among major states, with debt-to-GSDP ratios in the 40-45 per cent range, far above the FRBM norm. Odisha's strength is attributed to a fiscal deficit well within the 3 per cent FRBM benchmark, reduction in debt-to-GSDP from over 23 per cent in 2019-20 to around 14-15 per cent in 2023-24, a high share of own-tax revenue exceeding 60 per cent, robust mining-linked non-tax revenue, and capital outlay of around 4-5 per cent of GSDP focused on health, education, and infrastructure. The report recommends strengthening state tax capacity, rationalising committed expenditure, and improving quality of capital outlay for long-term fiscal sustainability.