Context: NITI Aayog has released the Investment Friendliness Index (IFI) to benchmark the investment ecosystem across States and Union Territories. The Index aims to promote competitive and cooperative federalism by encouraging reforms that improve the ease of investment and support the vision of Viksit Bharat @2047.
Explanation
- NITI Aayog: Established in 2015, it is the Union government’s policy think tank and promotes cooperation between the Centre and States.
- The Investment Friendliness Index (IFI) is a data-driven composite index assessing State’s ability to attract and sustain investments.
- It evaluates 28 States and 8 UTs across 8 pillars: Infrastructure, Business Climate, Resources, Government Policy, Regulatory Ease, Institutional Environment, Financial Health, and Environmental Resilience.
- The framework uses 84 indicators, combining secondary data and investor perception surveys.
- States are classified as Top Performers, Frontrunners, Emerging Performers, and Aspiring States; Gujarat, Maharashtra, Tamil Nadu, Goa, and Odisha emerged as overall Top Performers.
- The Index promotes Ease of Doing Business (EoDB), policy predictability, investor confidence, peer learning, and cooperative federalism to enhance domestic and foreign investment.
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