Context:

The Handbook of Statistics on Indian States 2024–25, published recently by the Reserve Bank of India, clearly shows that southern States continue to dominate India’s per capita income rankings. They occupy most of the top positions nationally and remain far ahead of the large northern States, reaffirming the persistence of a pronounced north–south economic divide.

Key Findings:

• • • Five southern States feature among the national top ten in per capita income. Telangana ranks second after Delhi, with a per capita Net State Domestic Product (NSDP) of ₹3,87,623 at current prices. Karnataka follows closely at ₹3,80,906, Tamil Nadu at ₹3,61,619, Kerala at ₹3,08,338, and Andhra Pradesh at ₹2,66,240.
    • In contrast, Maharashtra ranks sixth with a per capita NSDP of ₹3,09,340, while Madhya Pradesh (₹1,52,615), Uttar Pradesh (₹1,08,572), and Bihar (₹69,321) remain at the lower end of the spectrum. Notably, the gap between the highest-ranking southern State and Bihar exceeds fivefold, highlighting stark regional income disparities.

Economic Output and the Southern Advantage:

• • • Aggregate economic output figures reinforce this pattern of southern prosperity. Tamil Nadu and Karnataka form the economic core of the South, with NSDPs of ₹27.92 lakh crore and ₹26.03 lakh crore, respectively. Telangana (₹14.87 lakh crore) and Andhra Pradesh (₹14.22 lakh crore) follow, while Kerala records an NSDP of ₹11.11 lakh crore.
    • Although Maharashtra remains India’s largest State economy at ₹39.57 lakh crore, its per capita income places it only marginally above Kerala. Uttar Pradesh, with an NSDP of around ₹26 lakh crore—comparable to Tamil Nadu and Karnataka—continues to record one of the lowest per capita income levels, underscoring how large population size dilutes income gains.

Fiscal Health and Revenue Capacity:

• • • The handbook also brings out significant differences in fiscal capacity across States. Tamil Nadu and Karnataka reported strong own tax revenues of ₹1.95 lakh crore and ₹1.89 lakh crore, respectively, followed by Telangana, Andhra Pradesh, and Kerala.
    • Fiscal deficits remain sizable across most States. Tamil Nadu reported the largest fiscal deficit among the southern States, while Maharashtra stands out nationally with the highest own tax revenue of ₹3.42 lakh crore but also a substantial fiscal deficit. Bihar, despite its relatively low revenue base, continues to run deficits, pointing to a structural dependence on borrowings and central transfers.

Inflation, Poverty, and Social Outcomes:

• • • Social indicators further expose the regional divide. Inflation remained relatively moderate across most southern States, whereas Bihar and Uttar Pradesh recorded comparatively higher rates. Poverty levels reveal the sharpest contrast: Kerala’s multidimensional poverty rate stands at just 0.55 percent—the lowest in the country—while Bihar’s rate is as high as 33.76 percent.
    • Health expenditure shows less regional variation, reflecting population size and demographic needs rather than income levels alone. Overall, the handbook underscores the persistence of a north–south divide in India’s development trajectory and highlights the urgent need for balanced regional development to ensure more inclusive and equitable economic growth across the country.