State PCS - Uttar Pradesh (UP PCS)

• 22 Sep 2025

PM Lays Foundation of India’s 1st Freight Village

Why in News?

The Prime Minister laid the foundation for key infrastructure projects in Varanasi, including a ship repair facility and India’s first freight village, under the 'Prosperity from the Sea' initiative, aimed at boosting water transport and creating employment.

• He emphasized the role of waterways in strengthening the economy and creating jobs, aligning with the vision of 'Make in India.' 

Key Points.

• First Freight Village in India: The freight village is located over 100 hectares in Milkipur, Chandauli district, and will serve as a logistics hub, connecting different transport modes for smoother and more affordable goods movement.
  • It will link Haldia, Patna, Kolkata, and Kashi with eco-friendly freighters that cut transport costs by approximately 50% compared to road and rail.
• India’s First Dry-Dock Facility: Located in Ramnagar, Varanasi, this dry-dock, India’s first along the Ganga River, will be capable of repairing four vessels simultaneously, reducing both repair times and costs.
  • This will enhance regional development and provide sustainable employment opportunities for the youth in the Purvanchal region.

UP Emerges as Leading Revenue Surplus State

Why in News?

The Comptroller and Auditor-General of India (CAG) decadal study on state finances reveals that 16 states are in revenue surplus, with Uttar Pradesh leading the pack. 

Key Points

• Revenue Surplus States: The CAG report reveals that 16 states reported a revenue surplus in the fiscal year 2023, marking a significant turnaround for states once considered economically weaker. 
  • Leading the charge is Uttar Pradesh, with a surplus of ₹37,000 crore, a stark contrast to its previous standing as part of the BIMARU states.
    • BIMARU is an acronym for Bihar, Madhya Pradesh, Rajasthan, and Uttar Pradesh, a grouping of states that have historically lagged in economic and social indicators.
• Revenue Deficit States: Conversely, at least 12 states were found to be in revenue deficit in 2022-23, indicating significant fiscal distress. 
  • States like Andhra Pradesh, Tamil Nadu, and Rajasthan reported the highest deficits, pointing to a growing reliance on central grants.
• States Relying on Central Grants: Several states are heavily dependent on central financial support, with West Bengal receiving the largest share of 16% in FY 2023. 
  • These grants help bridge the gap between their revenue receipts and expenditure.
• Revenue from Own Sources: Some states have successfully boosted their revenue generation through both tax and non-tax means. 
  • Haryana leads with over 80% of its revenue coming from its own sources, followed by Telangana and Maharashtra with over 70% and 60% respectively.
• State's Own Tax Revenue (SOTR): The CAG report also highlights the reliance of certain states on States' Own Tax Revenue (SOTR), with six states (Haryana, Maharashtra, Telangana, Karnataka, Gujarat, and Tamil Nadu) deriving over 60% of their revenue from SOTR.
• Low SOTR States: On the other hand, some northeastern states and smaller regions like Arunachal, Manipur, Nagaland, and Sikkim report very low SOTR, with contributions from their own tax revenue falling below 20%.