Lucknow. Uttar Pradesh, once considered a sick state and notorious for its backwardness and financial hardship, has achieved significant economic success. According to a recent report by the Comptroller and Auditor General of India (CAG), Uttar Pradesh was in revenue surplus in the 2023 fiscal year. The CAG, after studying the economic performance of states over the past 10 years, reported that there are now 16 states in the country whose income exceeds their expenditure, meaning these states are in revenue surplus. Significantly, Uttar Pradesh tops this list with a revenue surplus of ₹37,000 crore. This demonstrates that, thanks to the policies implemented under the leadership of Chief Minister Yogi Adityanath, Uttar Pradesh is not only on the path of sustainable development but is also emerging as an example for other states to emulate.
The CAG report notes that Uttar Pradesh is followed by Gujarat (₹19,856 crore), Odisha (₹15,560 crore), Jharkhand (₹13,920 crore), Karnataka (₹13,496 crore), Chhattisgarh (₹8,592 crore), Telangana (₹6,944 crore), Kerala (₹5,310 crore), Madhya Pradesh (₹4,091 crore), and Goa (₹2,399 crore). Northeastern states like Arunachal Pradesh, Manipur, Mizoram, Nagaland, Tripura, and Sikkim are also among the surplus states. At least 10 of these 16 surplus states are ruled by the BJP.
12 states still grappling with revenue deficit
According to the report, 12 states in the country are still grappling with revenue deficits. These include Andhra Pradesh (-₹43,488 crore), Tamil Nadu (-₹36,215 crore), Rajasthan (-₹31,491 crore), West Bengal (-₹27,295 crore), Punjab (-₹26,045 crore), Haryana (-₹17,212 crore), Assam (-₹12,072 crore), Bihar (-₹11,288 crore), Himachal Pradesh (-₹6,336 crore), Kerala (-₹9,226 crore), Maharashtra (-₹1,936 crore), and Meghalaya (-₹44 crore). The report clearly shows that these states’ incomes are not sufficient to cover their expenditures.
According to the CAG report, states like West Bengal, Kerala, Himachal Pradesh, and Punjab rely on revenue deficit grants from the Center to meet their financial needs. In FY 2023, West Bengal alone received 16% of the grant to bridge the gap between its income and expenditure. Kerala received 15%, Andhra Pradesh 12%, Himachal Pradesh 11%, and Punjab 10%. Meanwhile, in FY 2022-23, Haryana, Maharashtra, Telangana, Karnataka, Tamil Nadu, and Gujarat were the states with the highest State Tax Revenue (SOTR), measured as a proportion of their total revenue receipts. Similarly, states like Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, and Tripura had SOTRs of less than 30%, reflecting their weak revenue potential.
Strengthened tax and non-tax sources
The report highlights states that have strengthened their revenue streams, both tax and non-tax. Haryana tops the list, with over 80% of its total income coming from its own revenue. This is followed by Telangana (79%), Maharashtra (73%), Gujarat (72%), Karnataka (69%), Tamil Nadu (69%), and Goa (68%). This demonstrates that these states have strengthened their own revenue sources rather than relying on the central government. The State GST (SGST) contributes the largest share of their revenue. Furthermore, VAT and excise duty on liquor, petroleum products, and electricity are also significant revenue sources for states, as these are outside the GST framework. According to the CAG report, in the financial year 2022-23, a total of ₹1,72,849 crore was allocated to states as Finance Commission Grants, of which ₹86,201 crore was allocated as Revenue Deficit Grants.
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