Karnataka tops country in per capita income, surpassing national average

New Delhi: On 21 July 2025, the Union Minister of State for Finance, Pankaj Chaudhary, announced in Lok Sabha that Karnataka has topped the country in per capita income during 2024-25, surpassing the national average.

In the financial year 2024-25, India’s per capita income reached
Rs. 1,14,710, reflecting a growth of Rs. 41,905 over the previous 10 years.

This is from a reply to a question in the Lok Sabha provided by the Union MoS for Finance.

The per capita net national income at constant prices for 2024-25 is estimated to be ₹1,14,710, according to the National Statistical Office.

This is an increase from ₹72,805 10 years ago in 2014-15.

There is a widening regional disparity in income among states such as Bihar, Jharkhand and Uttar Pradesh. It is visible from Table 1 that some states are not even ready to disclose their state income information, which may be to avoid embarrassment in comparison to others.

The Union Minister also stated as follows: “The differences in the increase in per capita income across states may be attributed to a range of factors such as varying levels of economic development, sectoral composition, structural disparities, and differences in governance mechanisms, among others. The government has been committed to the objective of inclusive growth, as reflected in its commitment to Sabka Saath, Sabka Vikas, and has initiated several targeted schemes aimed at reducing poverty and inequality, ensuring social security, promoting income generation and livelihood opportunities, and improving the quality of life of vulnerable sections across the country.”

Karnataka aces the game

Karnataka has become the state with the highest per capita income in India for the financial year 2024-25, showing a significant growth over the past decade.

It showed a per capita of Rs. 2,04,605 of National State Domestic Product (NSDP), which is way above the national average per capita income of Rs. 1,14,710 in the financial year 2024-25.

Other states should study the top 3 states —Karnataka, Tamil Nadu and Haryana for more successful policy frameworks and implementations.

The way ahead

However, despite its economic success, Karnataka must fix its structural issues. The state’s economy depends heavily on the service sector, with ITES making up 68 percent of the GSDP.

This reliance makes the economy susceptible to external volatility in case of worldwide tech declines and geopolitical changes.

Though Karnataka is taking a holistic and strategic approach to sustainable development goals (SDGs), it has to reduce and address the inequalities within its geography.

As is the case with any growing economy, economic inequality will be a natural fallout and could damage social unity and impede general advancement in the long run. This issue must be addressed by policymakers for better results.

Excessive reliance on the ITES sector must be cut through diversification and balanced regional growth, as well as other sectoral growth.

Karnataka can lead the country in sustainability through this policy approach.