NITI Aayog has released the Investment Friendliness Index (IFI), a comprehensive framework designed to assess how effectively States and Union Territories (UTs) create and sustain an environment conducive to domestic and foreign investments.
The Index provides a structured, data-driven and comparative assessment of the investment ecosystem across all 28 States and 8 Union Territories, evaluating policy, institutional, regulatory and infrastructure-related factors that influence investment decisions.
The report highlights that while the Central Government provides the overall policy direction for economic growth, State Governments play a crucial role in attracting investments through quality infrastructure, efficient regulations, strong institutions and predictable policy frameworks.
The IFI aims to strengthen competitive and cooperative federalism by encouraging States and UTs to adopt best practices and undertake continuous reforms in line with the vision of Viksit Bharat @2047.
Eight Pillars of the Investment Friendliness Index
The Index evaluates investment attractiveness across the following eight pillars:
- Infrastructure
- Business Climate
- Resources
- Government Policy
- Regulatory Ease
- Institutional Environment
- Financial Health
- Environmental Resilience
Methodology
The framework comprises 84 indicators, based on secondary data from official sources, and perception-based indicators obtained through a primary survey of investors. Based on their overall scores, States and UTs have been classified into four categories:
| Category | Score |
| Top Performers | Above 50 |
| Frontrunners | 45–50 |
| Emerging Performers | 40–45 |
| Aspiring States | Below 40 |
Top Performers
Gujarat, Maharashtra, Tamil Nadu, Goa and Odisha emerged as the Top Performers in the inaugural Investment Friendliness Index. 15 States were classified as Frontrunners, eight States/UTs were placed in the Emerging Performers category, eight States/UTs were categorized as Aspiring States.
Source: PIB
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