Introduction
Punjab, one of the northernmost states of India, is bordered by the Pakistani province of Punjab to its west, Jammu & Kashmir in the north, Himachal Pradesh in the northeast, Haryana in the south and southeast, and Rajasthan in the southwest.
As of FY26 (Until August 2025), Punjab has a total installed power generation capacity of 14,667.35 MW, with 3,965.13 MW under the central sector, 3,281.20 MW under state utilities, and 6,881.02 MW under the private sector. Of the total installed power generation capacity, 8,364 MW was contributed by thermal power, 3,827.44 MW by hydropower, and 6,074.26 MW was generated from renewable energy.
According to the Department for Promotion of Industry and Internal Trade (DPIIT), cumulative FDI inflow in the state stood at Rs. 9,839.44 crore (US$ 1,285.81 million) between October 2019-June 2025.
Tourism in Punjab
Punjab offers a rich culture with Vibrant festivals, historic landmarks like the Golden Temple in Amritsar, and lush agricultural landscapes. Tourists can explore traditional Punjabi cuisine, colourful markets, and heritage sites, making the state a unique and memorable tourist destination.
According to the State Tourism Policy, 2018, the government has he following goals:
- To promote tourism and to double the annual tourist visits in the state from 25 million to 50 million in the next five years by creating new infrastructure and improving the existing one.
- To boost the tourism sector in the state, the Punjab Government unveiled the Punjab Adventure Tourism Policy 2023 and the Punjab Water Tourism Policy 2023.
Economy of Punjab
At current prices, Punjab’s gross state domestic product (GSDP) is projected to stand at Rs. 8.91 trillion (US$ 101.07 billion) in FY26.
The state’s GSDP (in Rs.) increased at a CAGR of 9.61% between FY16 and FY26.
The state’s per capita GSDP in 2023-24 stood at Rs. 225,356 (US$ 2,721.69).
The per capita GSDP (in Rs.) increased at a CAGR of 6.87% between 2015-16 and 2023-24.
Agriculture in Punjab
- Punjab's progressive horticulture model received praise for strengthening fruit and vegetable processing through new cold storages, value-addition centers, and agro-processing units which will support post-harvest management and improve returns for horticulture farmers.
- In 2024, Punjab successfully exported litchis grown in 3,250 hectares, producing about 13,000 metric tons annually, marking a significant milestone opening international markets for Punjab's horticultural products.
- Punjab’s horticulture produce contributes nearly 17% of the state's agricultural GDP, with approximately 5 lakh hectares under horticulture, showing significant sector size and positive government attention.
- In 2025-26 budget estimates, Punjab has allocated 9.9% of its expenditure towards agriculture. This is higher than the average allocation towards agriculture by states (6.3%).
- In the State Budget for FY26, the government allocated Rs. 9,992 crore (US$ 1.13 billion) towards power subsidy of farmers.
- Punjab attracted Rs. 29,480 crore (US$ 3.32 billion) in investments in FY26 across sectors, including agriculture and agro-processing. This wave of investments is projected to generate over 67,000 jobs, signifying a strong policy or regulatory environment for allied industries.
- Punjab has a strong agriculture base with a huge production of principal crops such as rice, maize, sugarcane & barley.
- Top three fruits with the highest production recorded in 2022-23 were Kinnow, Guava and Mangoes. The highest yield was seen in Bananas (61,018 Kgs/ha), Grapes (30,969 Kgs/ha) and Kinnow (26,832 Kgs/ha). However, the production of pear recorded the highest growth of 8.53% followed by 7.82% growth in the production of plum and 6.11% growth in the production of sweet orange.
- In the Rabi Marketing Season 2021-22, Punjab was the country’s top wheat procurer, with 132 lakh metric tonnes (LMT) of procurement at minimum support price.
Recent Developments in Key Sectors
- Union Minister for Education Mr. Dharmendra Pradhan virtually laid foundation stone for infrastructure projects worth Rs. 201 crore (US$ 22.67 million) at Central University of Punjab, Bathinda, enhancing higher education capacity.
- Punjab launched six road projects worth Rs. 21.9 million (US$ 246,955) covering various local stretches such as Bhamian Khurd to Shankar Colony, Bhamian Road to Tajpur Road, Jail Road, LC Road to Uchi Mangli, Gobindgarh to Uchi Mangli, etc., as part of ongoing infrastructure expansion efforts.
- Under the State Budget FY26, the government has allocated Rs. 19,110 crore (US$ 2.15 billion) for school education. Of the total, the government allocated Rs. 4,248 crore (US$ 479.03 million) towards Government Primary Schools and allocated Rs. 8,727 crore (US$ 984.10 million) towards Government Secondary Schools.
- A semiconductor manufacturing project worth Rs. 4,594 crore (US$ 518.04 million) was approved for Mohali, Punjab, expanding the chip-making capacity under the India Semiconductor Mission. This project will produce advanced components like MOSFETs and IGBTs used in EVs, renewable energy, aerospace, and defense, enhancing Punjab's role in India's semiconductor development.
- Punjab boasts 100% electrification of its railway tracks, marking a significant milestone.
- As of July 2024, there are 12 ongoing projects in Punjab aimed at constructing new tracks across a total of 1,158 km, with an investment of Rs. 19,843 crore (US$ 2.38 billion).
- AIPL Group disclosed a Rs. 2,500 crore (US$ 299.76 million) investment plan for residential and commercial projects in Punjab. Having developed integrated townships in Amritsar, the company sees significant potential in the region.
- Under the State Budget FY26:
- Rs. 2,392 crore (US$ 269.73 million) has been allocated for transport of which Rs. 1,610 crore (US$ 181.55 million) has been allocated for roads and bridges.
- Punjab has allocated 1% of its expenditure towards urban development. In 2023-24 Rs. 1,215 crore (US$ 137.01 million) was allocated for urban development.
- Government has allocated Rs. 19,110 crore (US$ 2.15 billion) for school education. Of the total, the government allocated Rs. 4,248 crore (US$ 479.03 million) towards Government Primary Schools and allocated Rs. 8,727 crore (US$ 984.10 million) towards Government Secondary Schools.
- A total allocation of Rs. 3,699 crore (US$ 417 million) has been designated for the urban health services - allopathy, while Rs. 632 crore (US$ 71.3 million) has been earmarked specifically for rural health services - allopathy.
- The state has emerged as a key hub for textile-based industries including yarn, readymade garments, and hosiery. With the development of apparel parks, favourable textiles policy and other incentives for the creation of textile infrastructure, the state offers numerous opportunities for investment. Punjab is the source of 95% of India’s woollen knitwear production, 85% of India’s sewing machine production, and 75% of India’s sports goods production.
- Total merchandise exports from Punjab stood at Rs. 16,317 crore (US$ 1.84 billion) in FY25.
- Engineering Goods, Rice, Drug and Pharmaceuticals, Cotton Yarn, Organic and inorganic chemicals and Meat, Dairy and Poultry products accounted for a majority share in the overall merchandise exports of the state.
FACTFILE
Capital
ChandigarhGeographical Area (sq km)
50,362State Language
Punjabi, Hindi and EnglishLiteracy Rate
76.7 per centKey Industries:
Tractors and auto components
Agro-based industries
Textiles
Pharmaceuticals
Light engineering goods
Food products
Chemical products
Bicycles and bicycle parts
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