📄 Abstract
This exploratory cross-sectional study examines the relationship between state-level fiscal health and sustainable development performance across the 18 major Indian states covered by the NITI Aayog Fiscal Health Index (FHI) 2025. The analysis combines FHI 2025 with the SDG India Index 2023–24 and the National Multidimensional Poverty Index headcount ratio 2023. While the second FHI edition (FHI 2026) was released on 11 March 2026, the present study uses FHI 2025 as the baseline fiscal benchmark, with FHI 2026 presented as a supplementary temporal check. The results reveal substantial divergence between fiscal health and sustainable development rankings. Spearman's rank correlation between FHI 2025 and SDG scores is negative but not statistically significant (ρ = −0.319, p = 0.197; 95% bootstrap CI: −0.72 to 0.18). Differences in mean SDG scores across FHI categories are also not statistically significant (F (3,14) = 0.923, p = 0.455). Among the five FHI sub-indices, Quality of Expenditure exhibits the largest absolute rank correlation with SDG scores (ρ = −0.669, p = 0.002), surviving the Bonferroni adjustment for the five sub-index correlations (adjusted α = 0.01); however, this relationship is exploratory and does not imply that expenditure composition causes weaker development outcomes. An exploratory Fiscal–Development Alignment Framework identifies four relative configurations: Development Strength with Lower Fiscal Health, High Fiscal Health and High SDG Performance, Fiscal–Development Divergence, and Relative Weakness on Both Dimensions. The findings indicate that fiscal health and sustainable development performance represent distinct dimensions of state performance. The study does not establish causality and is limited by its small cross-sectional sample and non-identical reference periods. The results support complementary monitoring of fiscal conditions and development outcomes rather than treating fiscal health as a proxy for overall state development. Accordingly, H₁ and H₂ are not supported by the empirical evidence.
🏷️ Keywords
📚 How to Cite:
Dr. Sudhakara Rao Bezawada , FISCAL HEALTH AND SUSTAINABLE DEVELOPMENT PERFORMANCE ACROSS 18 MAJOR INDIAN STATES: EVIDENCE FROM THE NITI AAYOG FISCAL HEALTH INDEX-AN EXPLORATORY CROSS-SECTIONAL COMPARISON , Volume 14 , Issue 9, September 2026, EPRA International Journal of Economic and Business Review(JEBR) , Pages: 38 - 48 , DOI: https://doi.org/10.36713/epra29020