India's Investment Friendliness Index: Revolutionizing State Competitiveness

The Finance Ministry, with Niti Aayog and DPIIT, is developing an 'Investment Friendliness Index of States' to boost competitiveness and attract private investments. Set to launch in 2025, the index will help states identify regulatory barriers. The initiative reflects the federal spirit to enhance investments.

The Finance Ministry, collaborating with Niti Aayog and DPIIT, is poised to introduce an 'Investment Friendliness Index of States' aimed at enhancing competition among states to attract private investments, as stated by Expenditure Secretary Manoj Govil on Sunday.

The new index, announced for the 2025-26 Budget, signifies a step towards promoting competitive cooperative federalism. Manoj Govil underlined the need for states to reform regulations to match federal efforts, addressing investor concerns about state-level regulatory obstacles.

While ranking states isn't the primary objective, the index is designed to motivate states to reassess and revamp their regulations to address investor challenges. The Department of Economic Affairs and Niti Aayog will finalize the index's timeline.

(With inputs from agencies.)