'Divergence is worrisome': NITI Aayog VC flags GDP gap between high and low-income states
Different development strategies are necessary for states like Tamil Nadu and Bihar or Uttar Pradesh, says NITI Aayog VC
- Sep 30, 2025,
- Updated Sep 30, 2025 3:53 PM IST
NITI Aayog Vice-Chairman Suman Bery has expressed concern over the growing divergence between high-income and low-income states in India, with high-income states contributing significantly more to the country's GDP despite having a smaller share of the population.
Speaking at the 6th Economics Conclave at the School of Economics, University of Hyderabad, Bery highlighted that high-income states, which make up just 26 per cent of India's population, contribute 44 per cent of the country's GDP. In contrast, low-income states, comprising 38 per cent of the population, generate only 19 per cent of the GDP. "This divergence is worrisome," Bery said, emphasising the need to address the disparity.
He further explained that different development strategies are necessary for states like Tamil Nadu and Bihar or Uttar Pradesh. "The development strategy that’s appropriate for Tamil Nadu and for Bihar or Uttar Pradesh will necessarily be very different," he said, pointing out the regional disparities that need to be considered for inclusive growth.
Bery also spoke about the potential for growth in low-income states, drawing attention to the fact that the further behind a region is, the faster it can grow. "In principle, the further behind you are, the faster you can grow," he said. While acknowledging that some of the so-called BIMARU states—Bihar, Madhya Pradesh, Rajasthan, and Uttar Pradesh—are still lagging behind, he noted that these states are showing improvement, stating, "There is no reason to think that individual states are destined to lag forever."
On the issue of employment, Bery highlighted that aggregate employment in India has increased by 150 million, with 80 million women entering agricultural work. He further noted that of these 80 million, 40 million are unpaid family workers, but they still contribute to the household as an economic unit.
NITI Aayog Vice-Chairman Suman Bery has expressed concern over the growing divergence between high-income and low-income states in India, with high-income states contributing significantly more to the country's GDP despite having a smaller share of the population.
Speaking at the 6th Economics Conclave at the School of Economics, University of Hyderabad, Bery highlighted that high-income states, which make up just 26 per cent of India's population, contribute 44 per cent of the country's GDP. In contrast, low-income states, comprising 38 per cent of the population, generate only 19 per cent of the GDP. "This divergence is worrisome," Bery said, emphasising the need to address the disparity.
He further explained that different development strategies are necessary for states like Tamil Nadu and Bihar or Uttar Pradesh. "The development strategy that’s appropriate for Tamil Nadu and for Bihar or Uttar Pradesh will necessarily be very different," he said, pointing out the regional disparities that need to be considered for inclusive growth.
Bery also spoke about the potential for growth in low-income states, drawing attention to the fact that the further behind a region is, the faster it can grow. "In principle, the further behind you are, the faster you can grow," he said. While acknowledging that some of the so-called BIMARU states—Bihar, Madhya Pradesh, Rajasthan, and Uttar Pradesh—are still lagging behind, he noted that these states are showing improvement, stating, "There is no reason to think that individual states are destined to lag forever."
On the issue of employment, Bery highlighted that aggregate employment in India has increased by 150 million, with 80 million women entering agricultural work. He further noted that of these 80 million, 40 million are unpaid family workers, but they still contribute to the household as an economic unit.