Key NITI Aayog Indices and State Rankings

NITI Aayog uses data-driven indices to compare the performance of states and Union Territories across development, innovation, health, education, energy, water, trade, and governance. These rankings help identify gaps, encourage benchmarking, and promote competitive as well as cooperative federalism.

For Prelims revision, the key point is that each index uses a defined framework, partner institution, and peer-group classification so that sub-national units can be compared more fairly and policy action can be targeted better.

Core role of NITI Aayog indices

• Policy tool: NITI Aayog functions as the apex policy think tank of the Central Government and replaced the Planning Commission on January 1, 2015.
• Governance approach: Its indices convert complex development goals into measurable indicators for evidence-based policy interventions.
• Competitive federalism: States and Union Territories are encouraged to benchmark performance, identify gaps, and adopt best practices.
• Peer comparison: Units are grouped into categories such as Major States, North-Eastern and Hill States, Coastal States, Landlocked States, and Union Territories for balanced ranking.
• Verification: Performance data is checked through official administrative portals and third-party audits before rankings are published.

SDG India Index

• Purpose: Developed in collaboration with the United Nations in India, it measures sub-national progress toward the Sustainable Development Goals.
• Coverage: It assesses 16 of the 17 global SDGs and evaluates Goal 17 qualitatively.
• Scoring: The composite score ranges from 0 to 100.
• Categories: Aspirant (0–49), Performer (50–64), Front Runner (65–99), and Achiever (100).
• Focus areas: It covers poverty, health, quality education, gender equality, clean water, affordable energy, and climate action.
• Launch: The SDG India Index was first launched in December 2018.

Poverty, innovation, and export indices

• National Multidimensional Poverty Index: Based on the Alkire-Foster methodology, this index measures non-monetary deprivation across three equally weighted dimensions: Health, Education, and Standard of Living.
• Indicators: It uses 12 indicators, including nutrition, child mortality, schooling, cooking fuel, sanitation, drinking water, electricity, housing, and assets.
• India-specific additions: Maternal Health and Bank Accounts are included as India-specific indicators.
• Data source: The index uses household microdata from the National Family Health Survey (NFHS).
• Output measures: It calculates the Headcount Ratio and Poverty Intensity.
• India Innovation Index: Developed with the Institute for Competitiveness, it evaluates regional innovation ecosystems across 70 indicators under seven pillars.
• Pillars: Five are Enabler pillars—Human Capital, Investment, Knowledge Workers, Business Environment, and Safety and Legal Environment—and two are Performance pillars—Knowledge Output and Knowledge Diffusion.
• Weightage: The index gives 50% weight each to Enabler and Performance pillars.
• Export Preparedness Index: This index measures state readiness for export-led growth through Export Policy, Business Environment, Export Infrastructure, and Export Performance.
• Structure: It has 13 sub-pillars and 70 indicators, covering trade infrastructure, R&D environment, export diversification, and administrative support.
• Classification: States are grouped into Coastal, Landlocked, Himalayan/North-Eastern, and Union Territory categories.

Energy, climate, health, and education indices

• State Energy and Climate Index: It tracks energy transition, energy security, and environmental sustainability at the sub-national level.
• Parameters: The index uses 27 indicators across six parameters: DISCOM Performance, Access/Affordability/Reliability of Energy, Clean Energy Initiatives, Energy Efficiency, Environmental Sustainability, and New Initiatives.
• Weightage: DISCOM Performance carries the highest weight at 40%.
• Categories: States are grouped as Front Runners, Achievers, and Aspirants.
• State Health Index: Titled Healthy States, Progressive India, it measures both incremental and overall performance.
• Domains: It covers Health Outcomes, Governance and Information, and Key Inputs/Processes.
• School Education Quality Index: SEQI assesses education systems on outcomes such as learning, access, infrastructure, equity, and governance processes.
• Objective: It is intended to improve public schooling standards through comparative assessment.

Water management and investment indices

• Composite Water Management Index: This index tracks groundwater restoration, major and medium irrigation supply, watershed development, participatory irrigation, and urban water management.
• Investment Friendliness Index: IFI evaluates the business environment for private capital inflow.
• IFI focus: It considers institutional environment, infrastructure support, financial health, and regulatory efficiency.
• Utility: These rankings are used to identify reform priorities and support better resource allocation.

Key Prelims Takeaways

• NITI Aayog: Established on January 1, 2015, replacing the Planning Commission.
• SDG India Index: Measures progress on 16 SDGs and uses a 0–100 scoring scale.
• National MPI: Based on the Alkire-Foster method and NFHS microdata.
• India-specific MPI indicators: Maternal Health and Bank Accounts.
• India Innovation Index: Has 7 pillars, with 5 Enabler pillars and 2 Performance pillars.
• Export Preparedness Index: Divides states into Coastal, Landlocked, Himalayan/North-Eastern, and UT categories.
• State Energy and Climate Index: Gives 40% weight to DISCOM Performance.