NITI Aayog Report Lists Telangana In Financial Achievers

NITI Aayog Report Recognises Telangana For Financial Stability Performance

Financial Health Index highlights Telangana’s economic progress

The NITI Aayog Financial Health Index (FHI) 2023–24 report has recognized Telangana for its financial performance during the period of governance under the Bharat Rashtra Samithi (BRS) government led by K. Chandrashekar Rao.

According to the report, Telangana recorded notable economic progress over the past decade by strengthening its own revenue sources and investing in irrigation infrastructure. These steps helped improve the overall financial position of the state.

Telangana ranks seventh among major states

The Financial Health Index assessed states based on five key parameters, including expenditure quality, revenue mobilisation, and debt sustainability.

Among 18 major states, Odisha secured the top position in the index. Telangana ranked seventh with a score of 44.3, placing it in the category of states with moderate fiscal strength.

The report noted that Telangana showed stronger performance compared to several states in revenue mobilisation and debt management.

Revenue generation places Telangana ahead of several states

Telangana achieved a score of 60.8 in revenue mobilisation, reflecting strong internal revenue capacity.

The report highlighted that Telangana performed better in this category than major states such as Gujarat, which scored 44.8, and Karnataka, which scored 43.2.

The state’s efficient use of tax collections and non-tax revenue sources was cited as a key factor in strengthening its fiscal base.

Debt management remains comparatively stronger

Data in the Financial Health Index indicated that Telangana’s debt management indicators were stronger than several southern states.

The state recorded a debt index score of 53.5, which was higher than neighbouring Andhra Pradesh at 36.6, Tamil Nadu at 39.1, and Kerala at 23.3.

The report stated that Telangana’s debt burden remains relatively controlled and refinancing risks are lower compared with some other states.

Need to improve debt sustainability indicators

Despite its overall financial stability, the report indicated that Telangana needs improvement in the debt sustainability category.

In this segment, the state recorded a score of 20.0. The report suggested that Telangana could further strengthen its ability to repay borrowings and reduce interest payment burdens.

Analysts noted that directing loans towards productive sectors could generate long-term financial benefits.

Financial stability maintained during KCR’s decade-long governance

The report stated that Telangana maintained financial stability throughout the ten-year governance period of K. Chandrashekar Rao.

Between 2014–15 and 2023–24, the state remained within the top seven positions in most years of the index. During the COVID period between 2020–21 and 2022–23, the state slipped slightly to ninth rank.

In the latest assessment, Telangana improved its performance compared with the previous financial year. The FHI score increased from 43.4 in 2022–23 to 44.3 in 2023–24, moving the state from eighth position to seventh.

Telangana placed in ‘Achiever’ category

The Financial Health Index classified Telangana under the “Achievers” category along with Odisha, Madhya Pradesh, Bihar, Chhattisgarh, Jharkhand, and Uttar Pradesh.

The report attributed Telangana’s placement to stable revenue sources and disciplined debt management. It also noted that the state demonstrated gradual financial recovery compared with the previous year.

In contrast, states including Kerala, Tamil Nadu, Punjab, and West Bengal were placed in the aspirational category due to weaker financial indicators.