Sector
State Fiscal Capacity
What state governments can raise, what they are already committed to spending, and what is left over to build with.
2 problems within this
In Some States, Salaries, Pensions and Interest Leave Little Room to Build Anything
In a specific group of states, salaries, pensions and interest consume so much of the revenue that little is left to build anything with. This is a state-level finding and is not claimed as a national one. PRS Legislative Research estimates that states will spend about half their revenue receipts on salary, pension and interest in 2025-26, with Assam, Himachal Pradesh, Kerala, Punjab and Tamil Nadu above 60 per cent. The Comptroller and Auditor General measures the same idea against revenue expenditure instead — a different denominator — and puts the national average at 43.49 per cent, with Nagaland highest at 74 per cent. NITI Aayog's Fiscal Health Index reaches the same place by a third route, recording committed expenditure of roughly 50-60 per cent of revenue receipts in the most stressed states. The three series are kept separate here rather than blended into a range that none of them supports.
States That Raise Least of Their Own Revenue Have the Least Room to Act
How much a state can raise for itself varies enormously, and the states that can raise least depend most on transfers from the Union. In aggregate, states' own tax revenue is the largest single source of their revenue receipts — 50.13 per cent in 2024-25 according to the Comptroller and Auditor General — so the problem is not a national shortfall but the spread around that average. NITI Aayog's Fiscal Health Index puts own tax revenue at about 6-7 per cent of gross state domestic product in the Himalayan states against about 8 per cent in the major states, with dependence on the Centre running at 60-90 per cent of revenue receipts against 30-50 per cent, which leaves correspondingly little room for states to act on their own priorities. Exact per-state percentages beyond these aggregates are not yet sourced.
Alongside this
Capital Markets & Investor Protection
How ordinary savers fare in the markets they are invited into.
Business Failure & Recovery
What happens when a company cannot pay: how long it takes, and how much anybody gets back.
Household Financial Fragility
What families are able to put aside, what they owe, and what happens to them when the income stops.
Credit Access for Small Enterprises
Whether the smallest businesses can borrow from the formal financial system on terms they can meet.
Financial Inclusion in Practice
Not whether people have been given a bank account, but whether the account is any use to them.
Do you support action on this problem?