ITANAGAR, 31 Aug: Arunachal Pradesh has recorded the highest revenue surplus “as a proportion of its gross state domestic product (GSDP) among 25 states and union territories for which comparable data was available for 2024-25,” according to a fiscal health assessment.

The state recorded a revenue deficit ratio of minus 12.1 per cent of GSDP, effectively indicating a substantial revenue surplus, according to Business Standard's India State Fiscal Health Tracker. The assessment is based on the Reserve Bank of India's 2025 Handbook of Statistics on Indian States.

Arunachal's performance placed it well ahead of other states, recording revenue surpluses during the period.

Meghalaya stood second with a revenue deficit ratio of minus 6.5 per cent, followed by Jammu and Kashmir at minus 6.2 per cent, Jharkhand at minus 3.7 per cent and Odisha at minus 3.1 per cent.

A negative revenue deficit indicates that a government's revenue receipts exceed its revenue expenditure, resulting in a revenue surplus. Conversely, a positive ratio means revenue expenditure is higher than revenue receipts.

At the other end of the spectrum, Punjab recorded the highest revenue deficit among the states and UTs covered by the assessment at 2.8 per cent of GSDP. Kerala and Andhra Pradesh followed at 2.2 per cent each, Himachal Pradesh at 1.9 per cent and West Bengal at 1.8 per cent.

The development assumes significance for Arunachal, which has also emerged strongly in another recent assessment of Northeastern states' finances. The Fiscal Health Index 2026 placed Arunachal at the top among Northeastern and Himalayan states covered by the assessment, highlighting its performance in quality of expenditure and fiscal prudence, although the state remains heavily dependent on central transfers.

However, the revenue-surplus ranking should not be treated as an overall assessment of the state's finances. The fiscal tracker evaluates states and UTs across eight indicators, and Arunachal's position varies significantly across them.

For instance, FY25 budget estimates put its outstanding liabilities at around 57 per cent of GSDP, the highest among the states and UTs for which comparable debt data was available.

The FY25 revenue-surplus comparison also excludes states and UTs for which comparable data are unavailable, including neighbouring Manipur, Mizoram, Nagaland and Sikkim.