Tamil Nadu government announced major investments in infrastructure, urban development and welfare initiatives aimed at transforming Chennai.
Published Mar 14, 2025 | 1:12 PM ⚊ Updated Mar 14, 2025 | 2:49 PM
Tamil Nadu Finance Minister Thangam Thenarasu presenting the budget.
Synopsis: The Tamil Nadu budget 2025-26 lists several key initiatives to transform Chennai. It also includes establishing a new city near Chennai to decongest it. The state government also plans to develop the transport facilities in the city.
The DMK government in Tamil Nadu unveiled its budget for the 2025-26 fiscal year on Friday, 14 March, announcing major investments in infrastructure, urban development and welfare initiatives aimed at transforming the capital city of Chennai.
It is the last full budget of the current government ahead of the Tamil Nadu Assembly election in 2026.
Finance Minister Thangam Thennarasu presented the budget in the Legislative Assembly, detailing key allocations for metro expansion, flood mitigation, education, women welfare and public transportation.
With Tamil Nadu facing significant urbanisation challenges, and local governments continue to address essential services such as drinking water, roads and transportation, the state plans to establish a new 2,000-acre city near Chennai with modern amenities.
Here is a look at the key announcements made for Chennai.
The budget allocated ₹10,500 crore for the Chennai Metro Rail Phase II project, which will add new corridors connecting underserved areas such as Madhavaram, Sholinganallur, and Poonamallee. This expansion, covering 118.9 kilometers, aims to improve connectivity and reduce congestion in the city.
Additionally, detailed project reports have been prepared for the extension of the Chennai Metro Rail network along the following routes:
The Chennai Poonamallee-Porur Metro line is set to open to the public in December this year, while ₹9,335 crore has been allocated for the Airport-Kilambakkam Metro line extension.
Additionally, ₹9,744 crore has been earmarked for the Koyambedu-Pattabiram Metro line extension, and ₹8,779 crore has been allocated for the Poonamallee-Sriperumbudur Metro line extension.
In response to severe flooding in recent monsoons, the budget earmarked ₹3,200 crore for flood mitigation.
Plans include strengthening stormwater drains, desilting key waterways and implementing advanced flood warning systems in flood-prone areas such as T Nagar, Velachery and North Chennai.
The finance minister also announced that the Adyar River restoration project, worth ₹1,500 crore, is set for completion within 15 months.
The state government allocated ₹1,800 crore for road widening and improvements, including upgrades to arterial roads such as Anna Salai and OMR.
Another ₹750 crore has been designated for modernising the Chennai Metropolitan Transport Corporation’s bus fleet, with plans to introduce 2,000 electric buses.
The finance minister also announced that a new flyover will be constructed from Velachery Main Road to Guru Nanak College, spanning three kilometers.
He also noted that, because of the Vidiyal Payanam scheme, women now account for 60 percent of public bus users. He referred to a planning committee report and said women are saving an average of ₹888 per month by utilising the scheme.
To address housing shortages, the budget includes an allocation of ₹2,500 crore for the Tamil Nadu Urban Habitat Development Board.
New housing projects for economically weaker sections will be developed in Perumbakkam and Kannagi Nagar in Chennai, along with slum rehabilitation efforts.
The Magalir Urimai Thogai (Women’s Entitlement Fund) scheme will also open applications for new beneficiaries.
The finance minister announced that a new water reservoir will be constructed near Chennai at a cost of ₹350 crore to address the city’s long-term water security.
The reservoir, near the Kovalam sub-basin in Chengalpattu district, will have a capacity of 16 TMC (Thousand Million Cubic Feet) and utilise 225 TMC of seasonal floodwater annually.
The project, spanning 4,375 acres of government land between Old Mahabalipuram Road (OMR) and East Coast Road (ECR) in Thiruporur taluk, is expected to supply 170 MLD (Megaliters per Day) of drinking water per year to Greater Chennai residents. Officials said the initiative is part of broader efforts to ensure sustainable water distribution across the city.
Additionally, a ₹2,423 crore primary circular pipeline project has been launched to ensure equitable water distribution across all parts of Chennai. The government has also allocated ₹602 crore for a combined drinking water project.
The state government announced that Chennai’s healthcare infrastructure will receive a sum with ₹1,200 crore earmarked for the renovation of government hospitals, including Rajiv Gandhi Government General Hospital and Kilpauk Medical College.
The budget also provides ₹950 crore for upgrading government schools and colleges, including the expansion of smart classrooms and teacher training programs.
To elevate Anna University into the world’s top 150 universities, the government will implement various initiatives, including the establishment of research centers. A total of ₹500 crore will be allocated over the next five years for this purpose.
The budget has expanded the Magalir Urimai Thogai scheme, providing monthly financial assistance of ₹1,000 to more women beneficiaries in Chennai. Additionally, ₹500 crore has been allocated for strengthening women’s safety initiatives, including CCTV installations, improved lighting, and additional all-women police stations.
The government has also allocated ₹100 crore for setting up fast-track courts to handle crimes against women and children, ensuring swift justice for victims. Additionally, self-defense training programs will be introduced in schools and colleges across Chennai, along with community policing initiatives to enhance safety in public spaces.
The budget includes plans for 10 new ‘Thozhi’ hostels to support working women, with the goal of establishing one in every district. Transgender students pursuing higher education will receive ₹1,000 per month, and efforts will be made to include transgender individuals in the Village Security Force.
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).
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, said the finance minister.
To preserve Chennai’s cultural landmarks, the government has allocated ₹600 crore for the restoration of sites such as the Ripon Building and Egmore Museum.
Plans also include enhancing the Marina Beach promenade and developing tourism-friendly infrastructure.
The Tamil Nadu government’s latest budget underscores its commitment to making Chennai a more resilient, connected and inclusive city, with these allocations expected to drive economic growth and improve residents’ quality of life.
(Edited by Muhammed Fazil.)
