Telangana slips to second spot in Per Capita Income as Karnataka takes lead

Telangana has slipped to second place in per capita income among major states, with Karnataka taking the lead in 2025-26 advanced estimates. Economists pointed to slowing growth momentum, policy transitions and weaker sectoral performance as reasons behind Telangana’s moderated economic expansion

Hyderabad: Telangana has lost its long-held top position in per capita income (PCI) among the major states, slipping to second place behind Karnataka, according to the latest 2025-26 advanced estimates released by the Ministry of Statistics and Programme Implementation (MoSPI). While Telangana recorded a PCI of Rs 4.18 lakh, Karnataka moved ahead with Rs 4.33 lakh.

Telangana’s per capita income growth has moderated over the past two financial years. While the state had consistently outperformed others during the BRS rule for nearly seven years, a closer look at the numbers indicates a slowdown in Telangana’s growth trajectory over the past two years.

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The state recorded an annual average growth rate (AAGR) of 14 per cent and a compounding annual growth rate (CAGR) of 10 per cent during the 10 years of BRS rule. Excluding the COVID period, the state consistently maintained double-digit growth. As a result, the growth rate of PCI in Telangana was 10.93 per cent in 2023-24, which declined to 9.78 per cent in 2024-25, before a modest recovery to 10.24 per cent in 2025-26.

In contrast, Karnataka maintained stronger momentum, posting 11.24 per cent growth in 2023-24, 11.37 per cent in 2024-25, and accelerating to 12.22 per cent in 2025-26, helping it overtake Telangana.

Other major states continue to trail behind. Tamil Nadu reported a per capita income of Rs 4.08 lakh in 2025-26, while Andhra Pradesh stood at Rs 2.94 lakh. Maharashtra and Gujarat recorded Rs 3.47 lakh and Rs 3.57 lakh, respectively, reflecting steady but comparatively lower levels.

Economists stated that a visible deceleration in Telangana’s economic momentum over the last two years was due to a combination of factors, including slower growth in key sectors, changes in public spending patterns, and policy transitions following a change in government. The Congress government, which assumed power in late 2023, has faced criticism from the opposition over a slowdown in economic management and execution.

While Telangana remained among India’s richest states in per capita income terms, the loss of the top rank was significant and indicated slower growth in the state economy. This trend raises concerns about sustaining the growth drivers that had powered the state’s rise, particularly in sectors such as IT, infrastructure, and agriculture support systems. A slowdown in any of these sectors can quickly reflect in per capita income.