New Delhi: When it comes to attracting investors and facilitating sustainable investments, Gujarat, Maharashtra, Tamil Nadu, Goa and Odisha have emerged as the best performing states in the first ‘Investment Friendship Index’ released by NITI Aayog on Friday.The states scored more than 50 on a scale of 1 to 100 in the index covering all 36 states and union territories, which was announced by Finance Minister Nirmala Sitharaman in the Budget 2025-26.Among the hilly and northeastern states, Uttarakhand (47.5) topped the list, followed by Assam (47.3) and Himachal Pradesh (46.1). Among the city states and union territories, Goa (53.1) emerged at the top, followed by Delhi (49.9) and Chandigarh (47.1).The index is based on the performance of states/union territories under eight pillars spread across more than 90 indicators covering infrastructure, business climate, resources, government policy, regulatory ease, institutional environment, financial health and environmental resilience. The index also took responses from 1,850 investors on these criteria to take their perceptions into account.Efficient port operations, favorable business climate and competitive energy sector pushed Gujarat (56.6) to the top, while Maharashtra (53.7) outperformed on the back of its ability to attract significant private equity/venture capital investments and strong economic indicators.
Investors ultimately make location-specific decisions based on factors including infrastructure quality and efficiency, regulatory certainty, institutional effectiveness and availability of skilled human resources, NITI Aayog Vice President Ashok Lahiri said.But he stressed that the index should not be considered a “pure race” between countries, but rather an indicator for understanding their performance and the scope for improvement.
Lahiri said, “The geopolitical situation has enough fluctuations, but the time to act is now, not tomorrow or later.”The index classifies states into three categories – large states, mountain and northeastern states, city states and union territories – for a more comparable ranking. Based on their overall results, all states/union territories were categorized into top performing states (scoring more than 50), leaders (45-50), emerging states (40-45) and aspirational states (less than 40). In June, while chairing the latest board of the central think tank, Prime Minister Narendra Modi called on states to pay attention to investor feedback and focus on reducing the compliance burden as he seeks to position India as an attractive investment destination.