Investment Friendliness Index (Government Schemes & Initiatives)
Investment Friendliness Index (Government Schemes & Initiatives)
Why In News:
NITI Aayog has released the first edition of the Investment Friendliness Index (IFI), a data-driven framework benchmarking the investment ecosystems of all 28 states and 8 Union Territories.
The index was announced in the Union Budget 2025-26 to strengthen competitive and cooperative federalism and support the Viksit Bharat @2047 vision.
Source: PIB Today, 17 July 2026, 'Investment Friendliness Index (IFI), NITI Aayog'
How the Index is Constructed
Methodology: The framework uses 84 indicators, combining secondary data and investor perception surveys to ensure a balanced evaluation.
Eight pillars: The IFI evaluates states across pillars including infrastructure, business climate, resources, government policy, regulatory ease, institutional environment, financial health, and environmental resilience.
Performance Categories: States and UTs are categorized into four groups:
Top Performers (score above 50)
Frontrunners (45–50)
Emerging Performers (40–45)
Aspiring States (below 40)
Top performers: Among large states, Gujarat topped the index, followed by Maharashtra and Tamil Nadu; Uttarakhand led hilly and North-Eastern states, while Goa topped the city-states and Union Territories category.
Key Facts for Prelims
NITI Aayog: National Institution for Transforming India, the government's premier policy think tank, established in 2015, replacing the Planning Commission, and headed by the Prime Minister as its Chairperson.
Related NITI Aayog indices: The Export Preparedness Index (EPI), the Fiscal Health Index, the SDG India Index, and the School Education Quality Index are other prominent NITI Aayog benchmarking tools for states.
Governing Council: The apex body of NITI Aayog comprising the Prime Minister, Union Ministers, and Chief Ministers of all states and Union Territories, providing a platform for cooperative federalism.
Vice Chairman: NITI Aayog's Vice Chairman is a full-time functionary equivalent to a Cabinet Minister, appointed by the Prime Minister, distinct from the part-time Governing Council members.