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The Economic Environment Index (EEI) study in the state of Tamil Nadu, India comes in the wake of the recognition to foster inclusive growth through a decentralised planning process. Such recognition inherently implies the existence of regional diversity that may not be visible in state level analyses. Often, we find that in districts and small towns beyond the metros, ability of firms and households to maximise their economic benefits is constrained by local factors that constitute the economic environment. Therefore, improving the economic environment available at the regional level for firms and households – the ultimate economic constituents to whom governmental schemes are targeted – can help them leverage their existing resources and benefit from the government programmes for their economic growth.
However, such an effort to strengthen the local economic environment has to first start with an understanding of local needs and aspirations and the gaps that act as constraints for the economic environment at the regional level. EEI helps to identify and facilitate an understanding of such constraints to private sector development and economic growth, and thus assists both private and public sectors in their efforts to improve the business environment at the local level.