This Budget, expected to outline key financial policies and allocations for the upcoming fiscal year, will also focus on environment and climate change, as the minister holds both portfolios.
Published Mar 14, 2025 | 8:19 AM ⚊ Updated Mar 14, 2025 | 1:15 PM
Tamil Nadu Finance Minister Thangam Thenarasu presenting the state budget.
Tamil Nadu Finance Minister Thangam Thenarasu presented the state Budget for 2025-26 in the Tamil Nadu Legislative Assembly on Friday, 14 March.
The budget is a comprehensive policy document of the Dravida Munnetra Kazhagam (DMK) government ahead of the 2026 elections, with a strong focus on education, infrastructure development, and addressing the challenges of an ageing population.
Thenarasu presented the budget, providing a balanced allocation for welfare and development.
The Tamil Nadu Economic Survey, released ahead of the budget positions the state as one of India’s richest and most economically resilient states, highlighting balanced growth, rising incomes, and strong social development.
Meanwhile, Leader of Opposition in the Tamil Nadu Assembly Edappadi K Palaniswami said there was no announcement in the budget regarding the reduction in petrol and diesel prices.
"There were also no announcements regarding the old pension scheme, cylinder subsidy, or monthly electricity charges," he added.
In the 2025-26 financial year, the state's own tax revenue is estimated to be ₹2,20,895 crore. This includes ₹1,63,930 crore under commercial taxes, ₹26,109 crore under stamp duty and registration fees, ₹13,441 crore under vehicle taxes, and ₹12,944 crore under state excise duties.
Non-tax revenue is estimated at ₹28,819 crore. Overall, the state's total revenue is projected to grow by 75.31 percent to ₹2,49,713 crore in the next financial year. Union government grants are estimated at ₹23,834 crore, and the Union government’s tax share is ₹58,022 crore, bringing total revenue to ₹3,31,569 crore, an increase of 12.81 percent.
Total expenditure for the next financial year is estimated at ₹3,73,204 crore, 9.65 percent higher than the current financial year. Capital expenditure is estimated at ₹57,231 crore, with total capital expenditure, including net debt, estimated at ₹65,328 crore. The estimated revenue deficit for the current financial year is ₹46,467 crore, which is expected to decrease to ₹41,635 crore in the next year.
This will represent 1.17 percent of the total GSDP, similar to the 2015-16 level.
The total fiscal deficit for the previous financial year, based on revised estimates, is ₹1,00,698 crore. For 2025-26, it is estimated to be ₹1,06,963 crore.
Despite a decrease in net debt, the total debt-to-GDP ratio for the state is expected to slightly increase from 26.41 percent in the 2024-25 estimates to 26.43 percent, and then decrease to 26.07 percent in the 2025-26 estimates, staying within the 28.70 percent limit set by the 15th Finance Commission.
In the wake of the profound impact of artificial intelligence worldwide, it has become an urgent historical necessity to continue providing our students with technological knowledge and skill development training, said the finance minister.
"The Tamil Nadu government, having carefully considered this, is fulfilling a promise made in the people's assembly four years ago by planning to provide advanced technological devices to students across all colleges in the state, including those in arts, science, engineering, agriculture, and medicine."
"As a first step, over the next two years, 20 lakh college students will receive a desktop or laptop based on their preference. This initiative is aimed at equipping our youth with the tools to succeed in the future high-tech world."
A fund of ₹2,000 crore will be allocated for this scheme in the 2025-26 financial year, he added.
A major initiative will be implemented in the next five years to uplift one lakh women as entrepreneurs, announced the Tamil Nadu finance minister.
Under this scheme, women will be provided with bank loans up to ₹10 lakh with a 20 percent subsidy, along with skill development training and sales consultation to start various businesses. For this initiative, a budget allocation of ₹225 crore will be made in 2025-26.
From April 1 2025, the registration fee for all immovable properties such as houses, land, and agricultural land valued up to ₹10 lakh registered in the name of women will be reduced by one percent, announced the state government.
The procedure for government officials and teachers to claim cash benefits for up to 15 days of leave accrued will be reinstated, effective from 1 April 2026.
In the 2024-25 budget estimates, the overall debt ratio to the Gross State Domestic Product (GSDP) was estimated at 26.41 percent.
Based on the current GDP estimate, the revised budget estimates for 2024-25 have slightly increased the debt ratio to 26.43 percent, said the finance minister.
"However, in the 2025-26 budget estimates, this ratio is expected to decrease further, reaching 26.07 percent. This is still within the 28.70 percent limit set by the 15th Finance Commission for the 2025-26 fiscal year."
The government's focus on reducing debt and improving financial stability is evident from these projections, he added.
In the 2024-25 budget estimates, the capital expenditure was initially estimated at ₹47,001 crore. However, this was revised down to ₹46,766 crore.
Due to the continued efforts to boost capital expenditure, the estimates for 2025-26 project capital expenditure at ₹57,231 crore, reflecting a growth of 22.38% compared to the revised estimates for 2024-25. In the 2025-26 budget, the capital expenditure, including net borrowings, is estimated at ₹65,328 crore, said the finance minister.
In the revenue and expenditure estimates for 2024-25, the total revenue receipts were estimated at ₹2,99,009 crore, which has been revised to ₹2,93,906 crore.
For the year 2025-26, the total revenue receipts are estimated at ₹3,31,569 crore, which is 12.81 percent higher than the revised estimates.
In terms of expenditures, the total revenue expenditure for 2024-25 was initially estimated at ₹3,48,289 crore. However, due to a reduction in non-developmental expenditures, it has been revised down to ₹3,40,374 crore.
For the year 2025-26, the total revenue expenditure is estimated at ₹3,73,204 crore, representing a growth of 9.65 percent compared to the revised estimates for 2024-25.
In the 2024-25 budget estimates, the share of central taxes was projected at ₹49,755 crore, which has been revised to ₹52,491 crore, announced Thangam Thenarasu.
"Despite this increase, the Union government continues to impose higher taxes and additional levies, resulting in a very limited share for the state government."
"Based on the Union government's revenue and expenditure plan, the share of central taxes for the 2025-26 budget is estimated to be ₹58,022 crore. While Tamil Nadu constitutes six percent of the country's total population and contributes nine percent to the national economic growth, the state's share in the central taxes is just four percent. This disparity highlights the injustice being imposed on the state," he added.
The finance minister said the state's own tax revenue has been increasing due to the government's efforts.
"However, the share of grants and contributions from the central government in the total revenue has been decreasing. The Union government has not released funds under the Integrated Education Scheme, nor did it release funds from the National Disaster Relief Fund (NDRF) for Tamil Nadu, which was affected by the Fenjal cyclone."
"The state received only a meager ₹276 crore from the NDRF for the relief operations of the two consecutive disasters, the cyclone and the massive floods in the southern districts. This has significantly impacted the financial position of the state government," he added.
The estimated own tax revenue of the state for the 2024-25 budget is projected at ₹1,95,173 crore, with revised estimates standing at ₹1,92,752 crore.
For the 2025-26 financial year, the state’s own tax revenue is expected to be ₹2,20,895 crore. This includes ₹1,63,930 crore under commercial taxes, ₹26,109 crore from stamp duty and registration fees, ₹13,441 crore from vehicle taxes, and ₹12,944 crore from state excise duties.
The growth in the state’s economy, adjustments in tax rates, and improvements in tax collection efficiency are expected to result in a 14.60 percent increase in the state’s own tax revenue in 2025-26.
The estimated non-tax revenue of the state for the 2024-25 financial year is ₹30,728 crore, with the revised estimates standing at ₹28,124 crore.
For the 2025-26 financial year, the state's non-tax revenue is expected to be ₹28,819 crore. Overall, the state's own revenue in the 2025-26 budget estimates is projected to be ₹2,49,713 crore, which will account for 75.31 percent of the total revenue receipts.
In the year 2025-26, a total of 1,721 postgraduate teachers and 841 graduate teachers will be appointed through direct recruitment, the finance minister announced.
The Teachers Recruitment Board will soon release the necessary recruitment notification for this process.
The state government announced the construction of Anbucholai old age homes.
"To ensure the overall well-being of senior citizens, 25 ‘Anbucholai’ centres will be established in Municipal Corporations, including Madurai, Coimbatore, Trichy, Salem, Tiruppur, Erode, Thoothukudi, Vellore, Thanjavur, and Dindigul, with a financial allocation of ₹10 crore, said the finance minister.
"In these day care centres, the elderly can engage in companionship and meaningful activities. Each ‘Anbucholai’ centre will provide various services, including day-care assistance, arrangements for essential medical care, and recreational activities, with the support of voluntary organisations," he added.
The finance minister announced that a Comprehensive Work Management System will be introduced across government departments.
A strong credit economy is essential for the widespread development of the state, said Finance Minister Thangam Thenarasu.
"Recognising this, the government has set an ambitious target of ₹9.5 lakh crore for credit distribution to priority sectors such as agriculture, small and medium enterprises, women’s self-help groups, and education in the upcoming financial year. This represents a 17.47 percent increase compared to the previous year, marking an unprecedented commitment to providing loans to these crucial sectors," he added.
He said a Unified Lending Interface will be introduced soon in Tamil Nadu.
Over 10 lakh house site pattas have already been distributed to various communities across the state, and an additional five lakh pattas will be distributed this year, said the Tamil Nadu finance minister.
"In the Chennai metropolitan area and its surrounding regions, families residing in government-designated unencumbered land for more than 10 years, as well as areas within a 16 km radius of district headquarters and within eight km radius of municipalities and town panchayats, are eligible to receive land pattas."
"Furthermore, an easing of the conditions has been announced for those residing on unencumbered land for over five years, allowing them to also receive land pattas," he added.
A new initiative will be implemented not only in Chennai but also in other major cities of Tamil Nadu, such as Coimbatore, Trichy, Madurai, Tambaram, and Avadi, to ensure the safety of women.
This project will include surveillance cameras across the cities, a face recognition system, automatic number plate recognition (ANPR), unmanned aerial vehicles (drones) for monitoring, and artificial intelligence-based video analysis to prevent crimes. The total cost of the project is estimated at ₹75 crore.
A budget of ₹206 crore has been allocated by the state government for the construction of 3,000 homes for Sri Lankan Tamils.
As part of the government's initiatives, major banks in Tamil Nadu have stepped forward to offer various benefits to government employees, their families, and government officials who maintain their salary accounts, the finance minister said.
"In the event of an unforeseen death in an accident or permanent disability caused by an accident, banks have agreed to provide a sum of ₹1 crore as personal accident insurance coverage."
"In case a government employee passes away due to an accident, their family will receive financial assistance for the marriage expenses of their unmarried daughters who have reached marriageable age. This assistance will be ₹5 lakh per daughter, up to a total of ₹10 lakh."
"For the daughters who have completed school and wish to pursue higher education in college, banks will provide financial assistance of up to ₹10 lakh for their higher education in the event of the government employee’s accidental death."
"Additionally, if a government employee passes away unexpectedly during their service, assistance measures for their family will be activated accordingly," he added.
Additionally, Artificial Intelligence, data analysis and communication skills training will be provided for government employees
Finance Minister Thangam Thenarasu said that 40,000 vacancies in various government departments will be filled soon.
The allocation for the National Highways and Minor Ports sector in the Tamil Nadu budget for 2025-26 stands at ₹20,722 crore.
As part of the initiative to create a greener Tamil Nadu, 10 lakh trees of indigenous species such as Vembu, Pungai, Naval, and Puli Maram will be planted, geotagged, and properly maintained, said Thangam Thenarasu.
This is aimed at enhancing the state's environmental efforts.
Additionally, to reduce fatal accidents and implement the vision of a "No Accident State," critical accident-prone areas, such as sharp curves, will be improved with an investment of ₹200 crore.
Continuing from this, to tackle the growing traffic congestion in Chennai this year, a four-lane elevated highway will be constructed along the East Coast Road from Thiruvanmiyur to Uthandi, spanning a length of 142 km.
This project, valued at ₹2,100 crore, will be carried out by the Tamil Nadu State Highways Authority (TANSHA).
"Furthermore, to promote industrial development and create more employment opportunities, the government has initiated several industrial corridors. The first phase of this initiative will involve the development of the Okkadam Seyar Industrial Corridor, which will help market the products manufactured in the Seyar Industrial Park to international markets," said Finance Minister Thangam Thenarasu.
For this, an amount of ₹250 crore has been allocated for the first phase of the works to be carried out during the current year.
To reduce traffic congestion in municipalities, cities, and metropolitan areas, ring roads are being constructed for key cities. As part of this, works to construct 14 ring roads will begin this year with a total estimated cost of ₹1,713 crore.
This includes the Koyambuthur West Ring Road, spanning 12.5 km with an estimated cost of ₹348 crore, and the Tirunelveli West Ring Road, spanning 12.4 km with an estimated cost of ₹225 crore. Additionally, an extensive project report will be prepared for the construction of a 48 km long Madurai Outer Ring Road.
Tamil Nadu is committed to preserving its rich heritage through the renovation of historic structures, ensuring that the charm and cultural significance of these monuments are maintained while modernising them for future generations, said the finance minister.
17 heritage buildings across Tamil Nadu will undergo restoration and renovation, including:
₹150 crore has been allocated for the restoration and renovation of these historic structures, preserving their architectural value while ensuring their relevance and use for modern-day needs.
The Tamil Nadu Urban Habitat Development Board (TNUHDB) is actively working to redevelop and reconstruct old and dilapidated housing units, ensuring better living conditions for economically weaker sections, the finance minister said.
Ongoing and upcoming Housing Projects
Housing fund for low-income groups
The Housing & Urban Development Department has been allocated ₹7,718 crore in this financial year to improve urban infrastructure and housing facilities.
Tamil Nadu’s handloom and power loom industry, which provides livelihood to five lakh weavers, is being modernised to keep up with technological advancements, said Thangam Thenarasu.
Powerloom Modernisation Scheme – ₹50 crore
Old powerlooms (more than three years old) will be upgraded into modern looms to produce high-value fabrics, with capital subsidy support.
₹30 crore per year will be allocated to upgrade 3,000 looms annually.
₹20 crore will be used to set up common facility centers, weaving sheds, and export-quality testing labs in powerloom clusters.
Handloom Support Program
The government is committed to ensuring fair wages for weavers and fulfilling market demands. An additional ₹10 crore will be provided as working capital assistance to handloom weavers’ cooperative societies.
The Free Dhoti and Saree Scheme will receive an allocation of ₹673 crore in this budget.
Enhancing textile manufacturing with technology – ₹50 crore over five years
To improve production precision and meet export standards, computer-aided design (CAD/CAM) software and automated fabric cutting machines will be installed in public facility centers.
50 percent capital subsidy will be provided for these advanced textile processing machines. This initiative aims to enhance productivity, increase exports, and uplift weavers and textile workers across Tamil Nadu.
To enhance dairy production and ensure both economic security for dairy farmers and nutritious milk products for consumers, the modernisation of dairy farms is being carried out across Tamil Nadu, the finance minister said.
"A modern wastewater treatment plant will be established at the Salem Aavin dairy farm at a cost of ₹15 crore, ensuring environmental sustainability."
₹10 crore has been allocated for modernising machinery in Erode district.
To improve milk measurement and data collection, modern milk meters, data collection systems, and indicators will be installed in dairy farms across Chennai and other districts at a cost of ₹5 crore.
To boost the marketing of dairy products, a new advanced butter and milk powder processing unit will be set up in Tiruvannamalai district with an investment of ₹10 crore.
To protect Tamil Nadu fishermen from frequent arrests by the Sri Lankan Navy and to secure the release of those imprisoned in Sri Lanka, the Tamil Nadu Chief Minister has been continuously urging the Union government to take strong diplomatic action, said Thangam Thenarasu.
He added that the compensation amount for boat owners, whose fishing vessels seized in Sri Lanka cannot be recovered, has been increased as follows:
"To support the families of imprisoned fishermen, the daily financial assistance has been raised from ₹350 to ₹500 per day."
"The Tamil Nadu government remains deeply committed to the welfare of fishermen, recognising the hardships they endure due to rough seas, cyclones, and livelihood uncertainties. To support them, the government has continuously increased subsidies, and in this financial year: ₹6,000 per fisherman will be provided as lean-season relief to 1,79,147 fishermen."
"To encourage savings during non-fishing periods, ₹3,000 each will be given to 2,10,850 fishermen and 2,03,290 fisherwomen. During the fishing ban period, 1,98,923 fishermen will receive ₹8,000 each, which includes ₹1,500 from the Union Government and an additional ₹6,500 from the Tamil Nadu Government."
A total subsidy of ₹381 crore has been allocated for these welfare measures. "Additionally, to ensure affordable fuel for fishermen, a diesel and kerosene subsidy of ₹286 crore has been earmarked in the budget estimates."
The Tamil Nadu finance minister announced that the ‘Innuyir Kappom - Nammai Kakkum- 48 Thittam’ has provided treatment to 3,43,156 beneficiaries.
"Under the ‘Innuyir Kappom - Nammai Kakkum- 48 Thittam’, launched as a pioneering initiative in the country to reduce road accident fatalities and associated medical expenses, a total of 723 hospitals, including 250 Government and 473 private hospitals, have provided treatment to 3,43,156 beneficiaries so far at a cost of ₹302 crore, saving numerous lives," he said.
To strengthen animal welfare and address issues caused by community dogs, the Tamil Nadu government will enhance the Animal Birth Control (ABC) program by investing ₹20 crore in 100 veterinary hospitals.
This initiative includes:
Additionally, the Tamil Nadu Animal Welfare Board will receive ₹20 crore in funding for various initiatives aimed at promoting animal welfare and responsible pet management.
The finance minister announced that the Tamil Nadu Tourism Promotion Facilities Act will be introduced to streamline and enhance tourism infrastructure across the state.
To enhance the tourism experience and meet the growing needs of domestic and international visitors, the Tamil Nadu government will invest ₹300 crore in modern infrastructure development across key tourism hubs, including:
"Recognising the need for efficient coordination and execution, dedicated tourism development authorities will be established for Mamallapuram, Thiruvannamalai, Thiruchendur, and Rameswaram in the first phase," he said.
"Additionally, to promote lesser-known tourist destinations, the state has allocated ₹100 crore to develop tourism infrastructure in unexplored areas, ensuring a more inclusive and widespread growth of the sector," he added.
To protect and reclaim temple properties, the Tamil Nadu government has made significant efforts, resulting in the retrieval of 7,327 acres of land, 36.38 lakh sq. ft. of plots and 5.98 lakh sq. ft. of buildings, said Finance Minister Thangam Thenarasu.
The total estimated value of these properties stands at ₹7,185 crore, he added.
"Additionally, restoration work for 84 temple tanks (Thirukkulams) has been carried out at a cost of ₹72 crore. The Hindu Religious & Charitable Endowments (HR&CE) Department’s publishing division has also reprinted and released over 216 rare books."
"For the 2025-26 financial year, ₹125 crore has been allocated for renovation and conservation works in temples that are over 1,000 years old," he added.
"Under the Thayumanavar Thittam, it has been identified that around 50,000 children from extremely poor families have lost both parents and are being raised by their relatives. To ensure their education continues without interruption, the government will provide a monthly financial aid of ₹2,000 until they complete their school education (up to 18 years of age)," the finance minister announced.
"Additionally, after completing school, these children will be supported for higher education and skill development training, enabling them to build a secure and self-reliant future. This initiative reflects the government's commitment to protecting and uplifting orphaned children through sustained financial and educational support," he added.
Through the four percent reservation implemented for persons with disabilities (PwDs) in government job recruitments, 1,493 PwDs have secured government employment over the past four years, noted Thangam Thenarasu.
"Similarly, to encourage the private sector to hire PwDs, private companies that employ at least 10 PwDs will be eligible for a salary subsidy of ₹2,000 per person per month for five years, provided by the state government."
"To empower persons with disabilities (PwDs) and help them achieve self-sufficiency with enhanced mobility, the state government will implement a ₹125 crore scheme to provide advanced assistive devices tailored to different types of disabilities," he added.
This initiative includes:
A total of ₹1,433 crore has been allocated to the Department for Persons with Disabilities (PwD) in this budget, said the finance minister
A grant of ₹10 crore will be provided in the upcoming financial year for the renovation and restoration of historic mosques and dargahs. Similarly, an additional ₹10 crore grant has been allocated for the repair and restoration of old churches.
In this budget, a total allocation of ₹1,563 crore has been made for the Welfare of Backward Classes, Most Backward Classes, and Minorities Department, said the finance minister.
"For 2,02,281 students from Backward Classes and Most Backward Classes studying in 9th and 10th grade, a total of ₹117 crore is required for educational scholarships. However, the Union Government has allocated only ₹19 crore for this financial year, which can benefit only a limited number of students," the finance minister said.
"To bridge this gap, the state government has allocated an additional ₹98 crore, ensuring that over two lakh students can continue their education without financial burden."
"In this budget, an allocation of ₹146 crore has been made for school education scholarships, and ₹335 crore for higher secondary education scholarships," he added.
The Tamil Nadu government said a new scheme will be formulated to upgrade and renovate 27 high-enrollment college hostels and 36 hostels that have been upgraded to college hostels over the past four years for Backward Classes, Most Backward Classes, Denotified Communities, and Minorities.
Over the next two years, infrastructure improvements, special repairs, and renovation works will be undertaken to enhance their quality and ensure better facilities for students.
The Nannilam Women’s Land Ownership Scheme has been introduced to ensure women's economic security, enhance their social status, and strengthen their livelihoods, said the finance minister.
"For the 2025-26 financial year, ₹20 crore has been allocated to implement this scheme," he added.
To ensure the development of basic infrastructure facilities in Adi Dravidar residential areas, the Ayothidasa Pandithar Housing Development Scheme is being implemented, said Thangam Thenarasu.
"This scheme focuses on providing roads, streetlights, and drinking water facilities along with essential infrastructure improvements. Additionally, 120 village knowledge centers are being constructed at an estimated cost of ₹117 crore. For the 2025-26 financial year, ₹280 crore has been allocated for the implementation of this scheme."
"The Tamil Nadu government is firmly committed to expanding global educational opportunities for Adi Dravidar and tribal students. To reduce their financial burden and enable talented students to pursue postgraduate or research programs in arts, science, commerce, law, engineering, and medicine at prestigious international institutions, the Annal Ambedkar Overseas Higher Education Scheme has been implemented."
"For the 2025-26 financial year, ₹65 crore has been allocated for this initiative," he added.
A Tribal Livelihood Policy will be formulated to preserve, utilize, and integrate traditional tribal knowledge while ensuring biodiversity conservation.
As an initial phase, government welfare schemes will be coordinated in Bargur and Kadambur hill regions of Erode district and Kalvarayan hills of Kallakurichi district to ensure that tribal communities receive the full benefits of these schemes. Additionally, special programs tailored to these regions will be implemented.
For the 2025-26 financial year, ₹10 crore has been allocated for this initiative.
A total allocation of ₹3,924 crore has been made for the Adi Dravidar and Tribal Welfare Department in the 2025-26 financial year.
"In this budget, ₹3,000 crore has been allocated for the Magalir Vidiyal payanam Bus Travel Scheme, ₹1,782 crore for student bus fare subsidies, and ₹1,857 crore for diesel subsidies. Overall, a total allocation of ₹12,964 crore has been made for the transport sector in this budget," said the finance minister.
He added that detailed project reports have been prepared for the extension of the Chennai Metro Rail network.
These detailed project reports will soon be submitted to the Union Government to secure capital funding contributions, he added.
The feasibility of implementing a Regional Rapid Transit System (RRTS) and a Semi High-Speed Railway in Tamil Nadu will be explored to enhance connectivity and reduce travel time between major cities and urban centers, he said.
Global Capability Centres and manufacturing industries will be provided incentive grants to conduct research in product design, development and innovation in collaboration with State Universities, Colleges and Research Centres.
For this purpose, an amount of ₹25 crore has been allocated towards setting up of Industrial Research and Innovation Fund which will facilitate Industry-Academia Partnership.
With the increasing urbanisation, integrated transport hubs that connect buses, suburban railways, and metro rail services play a crucial role, the finance minister said.
In this regard, a multi-modal transport hub will be established at Guindy with modern passenger amenities at an estimated cost of ₹50 crore.
Similarly, another multi-modal transport hub with state-of-the-art facilities will be developed at Vannarapettai, Chennai, at a cost of ₹50 crore.
"Birds of prey such as eagles, hawks, and vultures play a crucial role in maintaining ecological balance and are considered indicators of biodiversity health by environmentalists. In Tamil Nadu, these birds are found in regions such as Nilgiris, Coimbatore, Tirunelveli, Madurai (Arittapatti), and Pallikaranai," Thangam Thenarasu said.
"However, due to habitat destruction and the spread of toxic substances, these species are facing severe survival challenges. To protect their habitats and raise awareness among local communities, a Raptors Research Organization will be established with ₹1 crore funding from the Endangered Species Protection Fund," he added.
To reduce air pollution and carbon footprint, 700 diesel buses of the State Transport Corporations will be retrofitted to operate on Compressed Natural Gas (CNG), said Thangam Thenarasu.
This project will be implemented at a cost of ₹70 crore using funds from the Tamil Nadu Pollution Control Board.
A fund of ₹1,031 crore has been allocated for the procurement of 3,000 new buses to enhance public transportation in Tamil Nadu. 1,125 electric buses will be introduced with financial assistance from the World Bank and the German Bank.
Mini buses will be introduced on 2,000 additional routes across Tamil Nadu.
The Tamil Nadu government announced that a Marine Resource Foundation will be established with an allocation of ₹50 crore.
To achieve Tamil Nadu's goal of becoming a $1 trillion economy by 2030, the state's electricity demand is expected to double. To meet this, plans are being formulated to generate an additional 100 billion units of renewable energy by 2030.
Phase 1 of the Green Energy Transition: Pumped Storage Hydropower Projects
Vellimalai: 1,100 MW capacity
Azhiyar: 1,800 MW capacity
Total Investment: ₹11,721 crore through public-private partnership (PPP).
The finance minister said these initiatives will strengthen Tamil Nadu's clean energy infrastructure and support its long-term economic growth. He added that a new Integrated Renewable Energy Policy will be announced. ₹21,178 crore allocated for the Energy Department.
To tackle the rising incidence of non-communicable diseases, the noble initiative of ‘Makkalai Thedi Maruthuvam’ has provided various healthcare services, including home visits and screenings for high blood pressure and diabetes, benefiting 2.2 crore people so far, said the finance minister.
A Comprehensive Water Resources Development Programme will be implemented with a ₹2,000 crore fund to enhance water conservation, irrigation infrastructure, and sustainable water management across Tamil Nadu.
A new reservoir, Chennai’s sixth major water storage, will be constructed near Kovalam sub-basin in Chengalpattu district at a cost of ₹350 crore.
Capacity: 16 TMC storage, utilizing 225 TMC of seasonal floodwater annually.
Location: 4,375 acres of government land between Old Mahabalipuram Road (OMR) and East Coast Road (ECR) in Thiruporur taluk.
Impact: Ensures a long-term drinking water supply of 170 MLD per year for Greater Chennai residents.
The Information Technology and Digital Services sector has been allocated ₹131 crore to enhance digital infrastructure, innovation, and technological advancements across Tamil Nadu.
To support students preparing for competitive exams, an intellectual hub will be established. Additionally, to assist startups and entrepreneurs, co-working spaces with affordable office facilities will be provided.
The Chief Minister’s Innovation Hub (CM Spaces) in Kolathur, Chennai, has been well received by the public, said the finance minister.
He said it offers:
These centers will benefit entrepreneurs, IT professionals, and students, while also enabling women to work closer to home.
CM Spaces will be set up in 30 locations across all municipal corporations, including Chennai, Coimbatore, Madurai, Trichy, Salem, Tambaram, and Avadi, with each center being developed at a cost of ₹5 crore.
To promote space technology startups, a ₹10 crore "Space Tech Fund" will be established by the Tamil Nadu government.
Additionally, Chennai will house advanced facilities, including:
"These initiatives aim to strengthen Tamil Nadu’s role in the space technology sector," said the finance minister.
The state government has announced a group insurance scheme for 1.50 lakh workers in Tamil Nadu.
"The Kalaignar Handicrafts Scheme, launched by our government to support artisans involved in 25 different crafts — including wood and sculpture work, jewelry making, glass and bell metal crafts, and musical instrument manufacturing — has received widespread appreciation," said Thangam Thenarasu
"So far, ₹138 crore in loans and ₹28 crore in subsidies have been approved for 7,297 applications."
"For the 2025-28 period, ₹74 crore has been allocated as subsidy funding to assist approximately 19,000 artisans, ensuring financial support, skill training, and overall development in the handicrafts sector," he added.
To enhance the quality and production capacity of micro, small, and medium enterprise (MSME) clusters and to facilitate marketing and export opportunities, Common Facility Centers (CFCs) and other infrastructure will be developed with an investment of ₹50 crore in the following sectors and locations:
Aromatic products – Theni district
Egg-based food products – Namakkal district
Electrical transmission equipment – Paramakudi, Ramanathapuram district
Handicrafts – Thanjavur district
Engineering manufacturing products – Chennai
These initiatives aim to strengthen MSME clusters, boost exports, and create new business opportunities.
A total allocation of ₹1,918 crore has been made for the MSME sector to support its growth and development across Tamil Nadu.
To benefit micro, small, and medium enterprise (MSME) entrepreneurs across the state, new industrial estates will be developed by the Tamil Nadu Small Industries Development Corporation (SIDCO) in nine locations:
Thirumudivakkam (Kanchipuram district)
Saram and Nayanur (Viluppuram district)
Nagampalli (Karur district)
Sooriyur (Tiruchirappalli district)
Karuthapuliyampatti (Madurai district)
Thanishiyam (Ramanathapuram district)
Naduvur (Thanjavur district)
Narasinganallur (Tirunelveli district)
These estates will be developed across a total area of 398 acres with an overall project cost of ₹366 crore. This initiative is expected to generate employment opportunities for approximately 17,500 people
The Industry, Investment, and Trade Department has been allocated ₹3,915 crore, said the finance minister.
Tamil Nadu is home to 114 leading biotechnology companies. To further strengthen this sector, a state-of-the-art biotechnology park will be established near Chennai.
Key Focus Areas:
Features of the Biotech Park:
"Tamil Nadu has a rich maritime history dating back to the Sangam era. To revive and expand shipbuilding traditions and establish the state as a global shipbuilding hub, the government has introduced the Tamil Nadu Maritime Manufacturing Policy 2020," the finance minister said.
This policy focuses on:
Expected Impact:
"Recognising the significant role of airports in economic growth, the Tamil Nadu government has taken steps to expand major airports and develop new ones," said Thangam Thenarasu.
A new airport in Rameswaram, Ramanathapuram district, will be developed. This will boost tourism, increase connectivity to South Tamil Nadu, and contribute to the economic development of underdeveloped regions.
Land acquisition completed for the Chennai, Coimbatore, Madurai, Tiruchirappalli, and Thoothukudi airports with an investment of ₹2,038 crore, and the land has been handed over to the Airports Authority of India.
Salem Airport expansion is underway, with ₹350 crore allocated for land acquisition. The Parandur Greenfield Airport near Chennai is being fast-tracked.
"Over the past four years, leading global non-leather footwear manufacturers have set up factories in Viluppuram, Ranipet, Vellore, Kallakurichi, Karur, Perambalur, and Ariyalur. These factories have provided employment to over one lakh people, with 80 percent of the workforce being women from rural areas. Tamil Nadu has emerged as the top state in India for attracting foreign investments in this high-employment sector," the finance minister noted.
"To further boost this industry, two footwear industrial parks will be established in Cuddalore and Melur with an investment of ₹250 crore, creating 10,000 jobs. Additionally, a Footwear Skill Training Center will be set up by SIPCOT in Kallakurichi district."
"In the Central Region, a 250-acre engineering and manufacturing industrial park will be established in Tiruchirappalli, generating 5,000 jobs."
"Thoothukudi district has already attracted significant investments in the green hydrogen and vehicle manufacturing sector. Building on this momentum, a synthetic fiber and technical textile industrial park will also be established in the district."
"Additionally, in Madurai district, 10,000 jobs will be created in the manufacturing sector this year," he added.
"Tamil Nadu has successfully attracted global skill centers in Chennai and Coimbatore. Building on this success, the government is now set to establish Hosur as a new hub for global skill centers and research & development," the finance minister said.
"As part of this visionary initiative, the government will develop the Hosur Knowledge Corridor, featuring world-class infrastructure to attract leading global IT companies to set up their global skill and R&D centers."
'This initiative mirrors the transformation of Old Mahabalipuram Road (OMR) into Chennai’s IT Corridor and will further strengthen Hosur’s industrial and technological growth," he added.
The finance minister said that to ensure that all cities in Tamil Nadu benefit from the digital highway envisioned by Kalaignar, who pioneered the state’s IT revolution by establishing the TIDEL Park in Chennai 25 years ago, the government will set up:
"Tamil Nadu has emerged as India’s largest hub for electronics exports, contributing 33 percent to the national exports in this sector. The state's electronics exports have witnessed remarkable growth, surging from $1.66 billion in 2020-21 to $9.56 billion in 2023-24. The government continues to implement strategic initiatives to strengthen Tamil Nadu’s leadership in electronics manufacturing and exports," Thangam Thenarasu said.
"As the next step in its electronics growth strategy, the Tamil Nadu Semiconductor Mission 2030 has been launched as a five-year plan with an allocation of ₹500 crore. Under this initiative, a high-performance Semiconductor Design and Testing Centre (Fabless Lab) will be established in Chennai in collaboration with leading industry and academic institutions, with an investment of ₹100 crore."
"The state will actively encourage global semiconductor design firms and domestic startups to set up their design centers in Tamil Nadu, further solidifying its position as a key player in the semiconductor industry," he added.
To establish Coimbatore as a modern industrial hub excelling in engineering and manufacturing, two Semiconductor Equipment Manufacturing Industrial Parks will be developed:
These industrial parks will be set up in collaboration with leading companies from the USA, Singapore, Malaysia, and Taiwan, marking a significant step in Tamil Nadu’s semiconductor manufacturing ecosystem. This initiative is expected to propel the economic growth of the Coimbatore region to the next level.
A total allocation of ₹21,906 crore has been made for the Health and Family Welfare Department in the budget.
The key allocations include:
A total of ₹36 crore has been allocated by the Tamil Nadu government for providing HPV (Human Papilloma Virus) vaccinations, aimed at preventing cervical cancer and improving women's health.
The Tamil Nadu government will implement a phased approach to vaccinate all 14-year-old girls against cervical cancer.
With a view to reach all women near their homes, various services such as screening of major cancer diseases, heart diseases and counselling on lifestyle changes will be provided through mobile medical teams in collaboration with NGOs.
"The Gig workers welfare board has been created in Tamil Nadu. We will launch a program to extend help to ₹20,000 to gig workers to buy e-scooters for their work," announced the finance minister
The state government allocated a total of ₹120 crore to upgrade the Anna Memorial Cancer and Research Institute, enhancing its infrastructure and research capabilities.
A total of ₹110 crore has been allocated for early detection of cancer, ensuring timely diagnosis and improved treatment outcomes.
A total of ₹1,975 crore has been allocated by the state government for Labour Welfare and Skill Development to enhance workforce skills and improve the well-being of workers across Tamil Nadu.
To enhance their livelihood through vocational education, seven new Government Industrial Training Institutes (ITIs) with hostel facilities will be established in districts with a high concentration of construction workers to aid their children.
These ITIs, each offering six industrial trades, will be set up in:
Krishnagiri
Thiruvallur
Kanchipuram
Madurai (Tirupparangunram)
Tiruchirappalli (Manachanallur)
Coimbatore (Perur)
Dharmapuri (Karimangalam)
These institutes will be funded by the Tamil Nadu Construction Workers Welfare Board at a total cost of ₹148 crore. Through this initiative, an additional 1,370 students will receive vocational training each year, improving their career prospects.
To enhance skilled human resources and provide industry-specific vocational training to help youth secure meaningful employment, new Government Industrial Training Institutes (ITIs) will be established in 10 locations across Tamil Nadu.
These ITIs, each with four industrial sectors, will be set up in:
Thisayanvilai (Tirunelveli)
Embal (Pudukkottai)
Salavakkam (Kanchipuram)
Sembanarkoil (Mayiladuthurai)
Tha. Pazhur (Ariyalur)
Thiru Uthirakosamangai (Ramanathapuram)
Manapparai (Tiruchirappalli)
Kangeyam (Tiruppur)
Kurukkalpatti (Tenkasi)
Tiruchengode (Namakkal)
A total of ₹152 crore has been allocated for this initiative. With this, an additional 1,308 students will receive vocational training every year.
To meet the demands of emerging technological advancements and industry requirements, government engineering colleges in Tamil Nadu will introduce new undergraduate programs in the upcoming academic year. These programs will cover rapidly growing fields such as:
- Artificial Intelligence (AI)
- Cyber Security
- Advanced Manufacturing Technology
- Robotics
- Electric Vehicle Technology
- Environmental Engineering
To effectively introduce these modern technology courses, Centres of Excellence will be established in collaboration with industries, with an estimated investment of ₹50 crore.
Similarly, new diploma courses will be introduced in government polytechnic colleges in the following specialised fields:
- Smart Manufacturing Technology
- Cyber Security and Networking
- Food Technology
- Renewable Energy Technology
- Drone Design and Application
"India's diverse landscapes and numerous scenic locations make it an ideal destination for mountaineering enthusiasts. Trained mountaineers from India not only scale peaks within the country but also strive to conquer summits across the globe," the finance minister said.
"To support this ambition, Tamil Nadu will provide an incentive of ₹10 lakh to mountaineers from the state who successfully scale Mount Everest, the world's highest peak."
"Additionally, in this budget estimate, a fund of ₹572 crore has been allocated for the Department of Youth Welfare and Sports Development," he added.
The Tamil Nadu government announced a special incentive scheme to increase the number of successful candidates from Tamil Nadu in the Union Civil Services Examinations.
Every year, 1,000 selected students preparing for the Preliminary Examination will receive a monthly stipend of ₹7,500 for 10 months. Candidates who clear the Preliminary Examination will be awarded ₹25,000 as an incentive. Those who successfully pass the Main Examination and prepare for the Interview will receive an incentive of ₹50,000. This scheme will be implemented with a fund allocation of ₹10 crore.
Additionally, a fund of ₹2,500 crore has been allocated for education loans to benefit one lakh students.
The physical education curriculum in the state will be revised as per requirements.
"The Naan Mudhalvan scheme, a visionary initiative of the chief minister, aims to nurture youth from Tamil Nadu to compete on a global stage. This pioneering program, which other states in the country aspire to follow, has so far trained approximately 41.38 lakh students," the finance minister said.
"Additionally, one lakh teachers have received relevant training under this scheme. Notably, among the students trained last year, 1.04 lakh students have secured employment opportunities," he added.
The finance minister said a total ₹8,494 crore has been allocated for higher education.
The finance minister said ₹50 crore will be allocated for AI-based education in government engineering colleges in Tamil Nadu.
An excerpt from Finance Minister Thangam Thenarasu's speech.
A chieftain from the Sangam era was revered as a healer of hunger for feeding the poor and needy. Following in this tradition, many Tamil leaders have historically introduced pioneering initiatives to eradicate poverty and support students' education.
Continuing this legacy, the Honorable Chief Minister announced: "We will make any sacrifice to expand school education, make learning enjoyable, and ensure that no child goes hungry while gaining knowledge."
In line with this vision, the Chief Minister’s Breakfast Scheme was introduced. Currently, it benefits 17.53 lakh students studying in 30,992 government schools and 3,995 government-aided schools in rural areas, covering children from Class 1 to Class 5.
Studies indicate that after the implementation of this scheme:
- Student attendance has increased
- Nutritional levels have improved
- Learning outcomes have enhanced
For the first time in the country, this historic initiative will now be expanded to urban government-aided schools, benefiting an additional 3.14 lakh students from Class 1 to Class 5 starting from the upcoming academic year.
To support this expansion, ₹600 crore has been allocated in the forthcoming financial year.
"The Union government has withheld SSA (Samagra Shiksha Abhiyan) funds citing the three-language policy. However, prioritising student welfare and teacher benefits, the state government has allocated funds for the scheme," said the finance minister.
"Even after losing ₹2,000 crore, our chief minister firmly stands by the two-language policy and refuses to compromise," he said.
"For the Tamilian who serves Tamil, any obstacle will crumble like dust," Thangam Thenarasu said quoting Bharathidasan.
The finance minister said 34,000 students from Classes 1 to 5 have benefited from the Chief Minister’s Breakfast Scheme. "A fund of ₹600 crore has been allocated for this initiative," he said.
He added that the scheme is enhancing the school enrollment rate in the state.
"New buildings will be constructed for the Children's welfare Centers at a cost of ₹83 crore. A fund of ₹1,000 crore has been allocated for additional classrooms and infrastructure facilities in government schools. Computer labs will be established in 2,000 schools at a cost of ₹160 crore," announced Thangam Thenarasu.
Student hostels will be constructed in Chennai, Coimbatore and Madurai at an allocation of ₹275 crore to benefit 1,000 students each.
The School Education Department has been allocated ₹46,000 crore, said the finance minister.
The state government announced that Pudhumai Penn scheme and the Tamil Puthalvan scheme will be extended to transgender individuals as well.
"Transgender individuals will be recruited into the Oorkaavalpadai Police Force. In the first phase, 50 persons will be enlisted in Chennai," the finance minister said.
Employment & Training: 50 transgender persons to be inducted in Chennai, Tambaram and Avadi for traffic management and crowd control.
Equal Pay, Uniform & Benefits: Ensuring fair treatment on par with Home Guards.
Thangam Thenarasu announced that the state government will implement North Chennai development projects covering various segments.
The finance minister said free bus travel for women was among the first plans announced by the Tamil Nadu chief minister soon after he took charge.
Thangam Thenarasu also listed schemes implemented by the state government for women.
The finance minister said a new city of over 2000 acres will be developed near Chennai.
"The city will have schools, colleges, private enterprises, and other infrastructure. Housing facilities along with wide roads, parks and other leisure will also be created," he said.
He added, "To connect the new city with Chennai, all necessary infrastructure, including roads, metro, and other facilities, will be established. TIDCO will manage this project."
The finance minister announced that ₹675 crore will be allotted for modernisation of drinking water projects in the state.
He also announced a slew of drinking water projects across Erode, Mayiladuthurai, Thiruvallur and other districts and allocated ₹26,678 crore for the Municipal Administration and Water Supply Department.
Finance Minister Thangam Thenarasu said the ₹1,500 crore Adyar river restoration programme is nearing completion and will likely be completed in 15 months.
"In 2023-24, the state achieved 40.87 crore person-days in the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), with an expenditure of ₹13,392 crore," Thangam Thenarasu said.
"However, for the year 2024-25, ₹3,796 crore is yet to be released by the Union government, including ₹2,839 crore for wages for workers who worked between 27 November 2024 and 11 March 2025 and ₹957 crore for material component. The government of Tamil Nadu has been consistently urging the Union government to release these pending dues at the earliest," he added.
The finance minister said that the Chief Minister’s Rural Roads Scheme will be upgraded at a cost of ₹2,500 crore.
The budget also allocated ₹20,450 crore for rural development. ₹120 crore will be allocated to develop road infrastructure in rural areas. ₹310 crore for a new flyover of about three kilometers in Velachery in Chennai to address road congestion.
"Our programme to build one lakh houses, which was introduced in the last Budget, will be continued in 2025-26," announced Finance Minister Thangam Thenarasu.
"By 2030, 8 lakh houses will be built. For the year 2025-2026, one lakh houses will be constructed at an estimated cost of ₹3,500 crore," he said.
The state government has announced that archaeological research will be conducted in the districts of Sivaganga (Keeladi), Thoothukudi, Tenkasi, Nagapattinam, Cuddalore, Kallakurichi (Adhichanur ), and Salem (Telunganur).
It will also be expanded to the states of Karnataka, Andhra Pradesh, and Odisha. A fund of ₹7 crore has been allocated for archaeological excavations and scientific research.
The finance minister stated that the 2025-26 Budget has been designed with a vision for growth over the next 25 years.
While Finance Minister Thangam Thenarasu was delivering the budget speech, the BJP MLAs have walked out of the Assembly
"We are launching a major programme to take Tamil literature global and in the first phase we are allocating ₹10 crore for this," said the Tamil Nadu finance minister.
A fund of ₹2 crore has been allocated for organising book fairs abroad, including in Singapore and Kuala Lumpur in Malaysia and ₹10 crore to teach folk arts to students through folk artists.
He also said that the International Tamil Olympiad, “Agaram”, will be conducted every year. He added that a language museum showcasing the pluralistic nature of Indian languages, will be built in Madurai.
The state government announced that a fund of ₹1.3 crore has been allocated to Tamil Nadu Textbook and Educational Services Corporation for translating the Thiruvalluvar's Thirukkural into more languages.
The finance minister said: "In the last few years, budgets have gone beyond just stating numbers. We are seeing it as a tool for the development of our citizens."
Finance Minister Thangam Thennarasu quoted former chief minister CN Annadurai’s speech from his first budget at the Tamil Nadu Assembly in 1968.
Tamil Nadu’s rising debt has become a focal point of political debate ahead of the state’s 2025-26 budget, with opposition parties, particularly the BJP, alleging that the DMK government is driving the state into an unsustainable financial crisis.
However, an analysis of official data reveals that Tamil Nadu’s debt-to-GSDP ratio remains within the limits set by the 15th Finance Commission, despite the Union Government’s shrinking tax devolution and increasing financial centralisation, which have constrained the state’s revenue sources.
Finance Minister said women’s voting rights, property rights, and the unwavering commitment to the two-language policy have been key aspects of Tamil Nadu’s progressive governance
He quoted French economist Thomas Piketty, "Inequality is a choice, but we can choose a different path."
Thangam Thenarasu said that the state government will initiate steps to ensure the safety of women and ensure developments focused on them.
The finance minister said that from the time of the Justice Party, Tamil Nadu has consistently focused on poverty eradication, education, and infrastructure development, unlike many other states.
As the Speaker reached the House, the 2025 - 2026 Tamil Nadu Budget session begins.
While Finance Minister Thangam Thennarasu started his budget speech, Opposition leaders raised slogans in the Assembly.
Tamil Nadu’s textile industry, a crucial contributor to India’s garment exports and employment, faces mounting challenges. Industry leaders are urging the state government to address rising operational costs, labour shortages, and policy neglect ahead of the 2025-26 budget.
The Tamil Nadu government has released another cover page for the Budget, featuring an image of the Thiruvalluvar statue depicting advanced technology.
Tamil Nadu Finance Minister Thangam Thennarasu paid tribute at Kalaignar Memorial ahead of the Budget presentation.
Tamil Nadu Finance Minister Thangam Thennarasu paid tributes at Kalaignar Memorial ahead of the Budget presentation.
The budget is likely to announce major investments across key sectors, reinforcing Tamil Nadu’s commitment to self-sustainability.
Major expectations for education, infrastructure, and employment policy.
Union Finance Minister Nirmala Sitharaman said that the DMK government's removal of the official Rupee symbol ‘₹’ from the Tamil Nadu Budget 2025-26 documents reflects a dangerous mindset that weakens Indian unity.
The DMK government has reportedly removed the official Rupee symbol ‘₹’ from the Tamil Nadu Budget 2025-26 documents, which will be presented tomorrow.
If the DMK (@arivalayam) has a problem with ‘₹’, why didn’t it protest back in 2010 when it was officially adopted under the…
— Nirmala Sitharaman (@nsitharaman) March 13, 2025
