India’s richest and poorest states: Top GDP contributors, highest income earners revealed

According to a recent report by the Economic Advisory Council to the Prime Minister, cited in a Business Today article, Southern Indian states have outpaced their Northern counterparts in terms of contribution to India’s GDP and higher-than-average per capita incomes since liberalisation. The report, released on Tuesday, September 18, 2024, highlights the significant strides made by states like Karnataka, Andhra Pradesh, Telangana, Kerala, and Tamil Nadu.

Collectively, these five Southern states now account for 30% of India’s total GDP, underscoring their growing economic dominance. This economic progress is a testament to their industrial growth, better governance, and human capital development over the past few decades. Southern states are increasingly seen as key drivers of India’s overall economic growth.

Maharashtra, despite its declining share in the national GDP, continues to be India's top contributor. Previously contributing more than 15%, Maharashtra’s share has now dropped to 13.3%. However, the state’s per capita income has risen sharply, reaching 150.7% of the national average as of March 2024, further solidifying its economic importance.

In contrast, northern states such as Uttar Pradesh and Bihar have seen a noticeable decline in their GDP contributions. Uttar Pradesh’s share fell from 14% in 1960-61 to just 9.5%, while Bihar, despite being the third-most populous state, contributed only 4.3% to the national GDP. Nevertheless, Odisha has shown remarkable improvement, moving away from its earlier laggard status with steady economic gains.

West Bengal, which once ranked among India’s top GDP contributors, has witnessed a steady decline. In 1960-61, it accounted for 10.5% of the GDP, but now contributes only 5.6%. West Bengal’s per capita income has also dropped significantly. Once standing at 127.5% of the national average, it has now fallen to 83.7%, putting it below states like Rajasthan and Odisha.

Meanwhile, Delhi and Haryana continue to perform consistently well, with Delhi boasting one of the highest per capita incomes in the country.

The report highlights the growing economic disparity between India’s northern and southern states, with the south leading in both GDP contribution and per capita income growth.

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