New Delhi: A comprehensive analysis of Uttar Pradesh's economic trajectory reveals a significant turnaround over the past decade. Key indicators point to a strengthening fiscal position, a remarkable surge in export capacity, and a steady recovery in income levels, marking a decisive shift from the prolonged stagnation that characterized earlier years.
From Central Dependence to Self-Reliance: A Fiscal Transformation
Data on tax composition highlights a crucial change in the state's revenue structure. Until the financial year 2016-17, central taxes constituted 56 percent of Uttar Pradesh's total tax revenue, indicating heavy reliance on central transfers. By the 2025-26 Budget Estimates, this dependence had notably reduced, with the central share declining to 46.4 percent. Concurrently, the share of the state's own tax revenue climbed to 53.6 percent, underscoring improved internal revenue mobilization.
The state's budget size witnessed substantial expansion, growing by Rs 4.87 lakh crore between 2017-18 and 2025-26. This growth rate far outpaced the increase of Rs 2.28 lakh crore recorded in the preceding eight-year period from 2008-09 to 2016-17. Accompanying this expansion was a strategic shift in spending priorities, moving from a focus on organisational expenditure and basic services to outcome-based budgeting, digital transparency, and targeted investments in expressways, logistics, women's safety, and agricultural innovation.
Exports and Incomes: Breaking Decades of Stagnation
One of the most dramatic shifts has been in export performance. After over two decades of subdued growth, where exports crawled from Rs 8,000 crore in 1992-93 to Rs 84,000 crore by 2016-17, a sharp acceleration followed. Under the leadership of Chief Minister Yogi Adityanath, exports registered a powerful upswing, reaching Rs 1,86,060 crore by 2024-25. This growth is attributed to enhanced ease of doing business, investments in logistics, and policy support for high-potential sectors like textiles, electronics, food processing, and handicrafts.
Similarly, the story of per capita income reflects a long-awaited recovery. Once aligned with the national average at Independence, it had steadily declined to less than half of the national level over subsequent decades. Recent years show a positive reversal, with per capita income increasing from Rs 54,564 in 2016-17 to Rs 1,08,572 in 2024-25. While this represents a significant improvement, the state's per capita income at 52.90 percent of the national average in 2024-25 indicates that the gap, though narrowing, remains substantial.
Broad-Based Growth and Fiscal Prudence
The state's Gross State Domestic Product (GSDP) has seen impressive growth, expanding from Rs 13.3 lakh crore in 2016-17 to Rs 29.8 lakh crore in 2024-25—a more than twofold increase. This has been fueled by higher capital expenditure, infrastructure development in expressways and metro networks, growth in MSMEs, increased private investment, and improvements in power and logistics.
Fiscal health indicators are equally encouraging. Uttar Pradesh's share in the combined own-tax revenue of all states rose consistently from 9.9 percent in 2022-23 to 11.6 percent in 2024-25, making it the nation's second-highest contributor. The state also demonstrates greater fiscal discipline, with its interest expenditure as a percentage of revenue receipts consistently below the all-state average, recorded at 8.9 percent in 2024-25 against a national average of 12.1 percent.
Furthermore, the state's own-tax revenue as a percentage of GSDP outperformed the national average, reaching 10 percent in 2024-25 compared to the all-state average of 7.2 percent.
Governance Reforms and Digital Inclusion
The expansion of Direct Benefit Transfer (DBT) schemes has been a cornerstone of governance reform. Funds are now disbursed through 207 schemes across 11 departments. In 2024-25 alone, over 9.08 crore beneficiaries received Rs 1,11,637 crore, with estimated savings from reduced leakages pegged at Rs 10,000 crore. Digital transactions have skyrocketed from 122.84 crore in 2017-18 to 1,380.91 crore by March 2025.
This comprehensive improvement has been recognized by NITI Aayog, which placed Uttar Pradesh in the "front-runner" category in its assessment of states' fiscal conditions. The state's consolidated Fiscal Health Index improved by 8.9 points between 2018-19 and 2022-23, supported by revenue surpluses and a decline in debt levels relative to GSDP.
The data collectively paints a picture of an economy on the mend, diversifying its base, strengthening its finances, and building a more robust foundation for future growth, positioning Uttar Pradesh as an increasingly vital engine for India's economic ambitions.
