Uttar Pradesh emerged as the best state in terms of capital spending and completion of projects during the first three quarters of this current fiscal, while Gujarat bagged the numero uno position as regards the overall development, says a report.

In terms of total value of projects completed, Uttar Pradesh topped the list with Rs.185.5 billion, followed by Maharashtra at Rs.178 billion, Telangana Rs.111.3 billion and West Bengal Rs.61.3 billion, according to a Deutsche Bank research note.

When it comes to the number of projects completed, UP again grabbed the lead position 25 units during the April-December period of the current fiscal. Punjab saw completion of 21 units, while Maharashtra stood at third place with 19 units with regard to projects completed.

Overall, the project completion rate of all states is up 104 per cent in April-December 2016, from the year-ago period, with five states Maharashtra, UP, Telangana, West Bengal and Punjab constituting almost 83 per cent of total value of projects completed.

On the other hand, Gujarat, Bihar, Jharkhand, Odisha, Tamil Nadu, Karnataka and Kerala recorded a contraction in the project completion rate in April-December period of current fiscal over the year-ago period.

In terms of overall development that includes economic, social, fiscal and governance aspects, Gujarat was ranked as the best state, followed by Maharashtra, Tamil Nadu, Punjab and Karnataka. While Bihar, UP, Odisha, Rajasthan and West Bengal feature at the bottom in the list.

The report said that at state government level, capex spending has increased substantially since last financial year for most states, compared to their past trend, and encouragingly the positive momentum is continuing for many states through the current fiscal as well.

"It is encouraging to see that capex momentum in states such as UP, West Bengal and Bihar has picked up in the last two years, albeit from a low base, especially given that these states are generally regarded as economically backward relative to the other states. The challenge will be to sustain the momentum in the years ahead so as to bridge the gap with the other states," the report noted.

It further said states which have a higher urbanisation rate are also the same states that are relatively more prosperous and enjoys a higher score related to developmental metrics.

"The government's initiative to build smart cities across India is encouraging and should help expedite the pace of urbanisation, which has been abysmally slow in the last several decades.

The strategy of building or transforming small tertiary towns to cities and connecting them to hub cities like Mumbai, Delhi, Bangalore, Chennai and Kolkata, through high speed transport will increase productivity and reduce the problem of urban primacy," the report added.