The 2026 US-India Subnational Innovation Competitiveness Index
KEY TAKEAWAYS
The United States claims the top 51 regions, with the District of Columbia (DC), Massachusetts, and California ranking in the top three. The top three Indian states are Chandigarh, Maharashtra, and Delhi, although they rank below all U.S. states.
The highest scoring U.S. states for the knowledge economy pillar are DC, Wyoming, and Virginia. The top-ranking regions for India are Chandigarh, Puducherry, and Goa. Chandigarh has also surpassed Mississippi’s and Hawaii’s scores.
The highest-scoring U.S. states for the globalization pillar are New Mexico, Massachusetts, and Arizona; for India, these are Karnataka, Delhi, and Maharashtra. Besides New Mexico, they have surpassed all other U.S. states in this category.
The top-scoring U.S. states for the innovative capacity pillar are Washington, Massachusetts, and California. The top-scoring Indian regions are Maharashtra, Delhi, and Haryana. Maharashtra has surpassed 10 U.S. states; Delhi has surpassed Alaska.
Policymakers must continue to strengthen U.S.–India relations, focusing on building and strengthening critical and emerging technology and R&D collaboration initiatives, which connect start-ups, universities, and venture capitalists in both countries.
Indian policymakers should prioritize expanding the innovative capacities of states beyond concentrated regions by strengthening skills, research capabilities, digital infrastructure, and access to global investment across all regions.
INTRODUCTION
In this report, two member think tanks of the Global Trade and Innovation Policy Alliance (GTIPA) analyze the subnational innovation competitiveness of the states and regions of two nations: India and the United States.
India’s economic and technological footprint has expanded considerably over the past two decades. Although the country still accounts for only about 3 percent of global gross domestic product (GDP), its economy has grown rapidly, with real GDP increasing at an average annual rate of 6.5 percent from 2008 to 2019 and 7.7 percent from 2022 to 2025. At the same time, India’s population has grown to more than 1 billion people, providing the country with an enormous domestic market and labor force. Its economy is also becoming increasingly technology intensive: High-tech products increased from 10 percent of India’s manufactured exports in 2009 to 19 percent in 2024. Together, these trends illustrate India’s growing economic scale and its increasing potential to compete in innovation-driven industries.
The Indian government has sought to build on this momentum through its goal of achieving developed-economy status by 2047. Reaching that objective will depend in part on India’s ability to raise productivity, attract investment, expand advanced industries, and strengthen its technological capabilities. These efforts have become particularly important as firms and governments reconsider supply chains and economic relationships amid growing tensions between the United States and China. India’s combination of economic growth, market size, and expanding technological capabilities positions it as an increasingly important participant in this changing global economic landscape.
India already possesses considerable strengths in technology and services. Its established information technology sector and large pool of technical workers have encouraged multinational companies such as Google, Meta, and Oracle to establish and expand operations in the country, including work related to artificial intelligence, virtual reality, and data mining. India has similarly attracted substantial foreign investment, receiving $36.1 billion in fiscal year 2013 to 2014 and $94.5 billion by fiscal year 2025 to 2026. Continued investment could help the country build on its traditional strengths in information technology (IT) services while establishing a larger presence in advanced manufacturing and other innovation-intensive industries.
India’s improving performance in international innovation rankings reflects this broader transition. In the Global Innovation Index 2025, India ranked 38th among 138 economies, compared with 3rd for the United States. The difference highlights the substantial innovation gap that remains between the two countries, particularly given the United States’ strengths in research and development (R&D), technological infrastructure, research institutions, and human capital. At the same time, India has made considerable progress, rising from 81st in 2015 to 38th in 2025. This improvement reflects expanding innovation capacity, a growing start-up ecosystem, and greater emphasis on technology-driven economic development.
Yet, national-level indicators tell only part of the story. India’s economic and innovative capabilities vary substantially across its states and territories, with investment, talent, R&D, entrepreneurship, and advanced industries concentrated in particular regions. Examining these subnational differences provides a clearer picture of where India’s innovation economy is strongest, where significant gaps remain, and what will be required for the country to sustain its economic and technological progress.
This is why developing a national innovation and competitiveness strategy is so important. For a country to grow into a significant player in the global economy, its capacity to nurture an educated workforce, increase productivity, transfer knowledge, and develop and adopt new, innovative technologies is vital. Understanding these subnational factors is crucial for a comprehensive assessment of innovation capabilities. By exploring specific regional influences, stakeholder interactions, and local policies, we can gain deeper insights into how effective public policy can contribute to national innovation performance. This nuanced perspective can enrich our understanding of national rankings and inform targeted strategies for enhancing innovation ecosystems tailored to the unique contexts of various regions.
The Institute for Competitiveness (IFC) has released three editions of the India Innovation Index, which evaluates the innovative capacity of subnational regions in India. That initiative has been done in collaboration with NITI Aayog, a public-policy think tank of the government of India. Similar to the U.S.–India Subnational Innovation Competitiveness Index (SICI), this report employs a comprehensive approach to assess innovation based on broader dimensions. The Index ranks regions using a robust methodology and seeks to highlight the opportunities and potential of fostering innovation in each Indian state and union territory. Relevant stakeholders within state governments utilize insights from the Index to formulate policies that promote innovation. The report also aims to encourage the spirit of competitive federalism in India. In line with the India Innovation Index, the Information Technology and Innovation Foundation (ITIF) has contributed significantly to the literature on this topic with a series of in-depth subnational innovation competitiveness reports, which provide nuanced insights into the intricate relationships between innovation, economic development, and regional competitiveness, offering valuable perspectives for policymakers, businesses, and researchers alike. This series includes reports such as ITIF’s “State New Economy Index,” which assesses the innovative structures of U.S. states to determine to what extent these structures drive innovation. Additionally, ITIF, in collaboration with GTIPA, has produced the Balkan SICI in 2026, one of the latest in a series of reports examining the role subnational regions play in domestic and international innovation networks.
This report does not serve as a ranking of innovation between American and Indian states, but rather offers a critical comparison. Significant gaps exist between the most-innovative U.S. states and Indian states and territories, with even the most-innovative Indian region falling behind the least-innovative U.S. state. By examining the strategies undertaken by innovation leaders such as California and Massachusetts, India can develop innovation-driven policy to replicate the factors that have led to these states becoming the forefront of innovation. This study aims to showcase the existing innovation networks in the United States and India, informing both U.S. states on ways in which they could improve and Indian regions of potential directions that could be taken to overcome innovation gaps and come closer to reaching the frontier of innovation