Published Feb 17, 2026 | 9:47 AM ⚊ Updated Feb 17, 2026 | 1:10 PM
Tamil Nadu Finance Minister Thangam Thenarasu presenting the state budget.
The interim Budget and the Agriculture Budget for the financial year 2026-2027 were presented in the Tamil Nadu Legislative Assembly on Tuesday, 17 February.
Finance Minister Thangam Thennarasu presented the interim Budget, and Minister of Agriculture and Farmers’ Welfare MRK Panneerselvam presented the Agriculture Budget, ahead of the Assembly elections this year.
Ahead of the 2026 interim Budget, the Tamil Nadu government had released its second Economic Survey of Tamil Nadu (2025–26), which traces the state’s economic performance under the DMK administration over the past five years.
The state recorded real Gross State Domestic Product (GSDP) growth of 11.19 percent in 2024–25, the highest among major Indian states and more than four percentage points above India’s national growth rate of 6.5 percent, according to the survey. This is the state’s strongest economic performance in 14 years, surpassing its own post-2010 peak of 13.12 percent.
In nominal terms, Tamil Nadu’s economy expanded to ₹31.19 lakh crore, registering nearly 16 percent growth in a single year. The survey projects this to rise to ₹36.57 lakh crore in 2025–26 and ₹41.03 lakh crore in 2026–27, placing the state on course to achieve its stated ambition of becoming a $1 trillion economy by 2030.
The Tamil Nadu Legislative Assembly adjourned for the day after the interim budget and the Agriculture budget. The House will reconvene tomorrow at 9.30 am.
An allocation of ₹47,248 crore has been made for the Agriculture and Farmers’ Welfare Department.
The agriculture minister said free electricity connections have been provided to the lands of two lakh farmers.
"Through the e-Vaadagai mobile application, 3,816 agricultural machines have been rented out to farmers at subsidised rates."
MRK Pannerselvam said a subsidy of ₹4.56 crore is being provided to encourage youth to become entrepreneurs in the agriculture sector.
He added that 1,000 Uzhavar Welfare Service Centres have been established to distribute fertilisers and seeds.
The agriculture minister said that as many as 53 lakh coconut saplings have been distributed to farmers.
"A total of 10,588 minor irrigation tanks, ponds, and canals have been desilted and improved. A total of 58,000 acres of fallow land have been converted into cultivable farmland."
MRK Pannerselvam said research on natural farming is being carried out at the Nammalvar Natural Farming Research Station in Coimbatore.
"The initiative has been undertaken in the name of Nammalvar, focusing on promoting and strengthening natural farming practices in the State.
Meanwhile, under the Nel Jayaraman scheme, 900 metric tonnes of traditional paddy seeds are being distributed to farmers to encourage the cultivation of indigenous rice varieties."
He added that the Kuruvai cultivation scheme has been implemented at a cost of ₹482 crore, benefiting 19.51 lakh farmers.
The agriculture minister said steps have been taken to obtain Geographical Indication (GI) tags for Tamil Nadu's unique agricultural produce, and applications have so far been filed for 41 products.
He said GI tags have already been granted to nine products, including Thoothukudi Vetrilai (betel leaves), Panruti Jackfruit, Panruti Cashew, Virudhunagar Samba, Pattamalai varieties, Ramanathapuram Chithirai Kaar Rice, Puliyangudi Lemon, Chettikulam Small Onion, Mappillai Samba Rice, and Koundampadi Country Sugar.
Minister MRK Pannerselvam said an incentive amount has been provided under the 2025–26 Kuruvai paddy procurement target.
"For fine varieties of paddy, an incentive of ₹156 per quintal has been given, and for common varieties, ₹151 per quintal has been provided. With this, the procurement price has been increased to ₹2,565 per quintal for fine varieties and ₹2,500 per quintal for common varieties.
Over the past five years, a total of 156 lakh metric tonnes of paddy have been procured, and ₹2,185 crore has been disbursed as incentive payments. In the 2020–21 year, the incentive was increased by 123% for fine varieties and 168% for common varieties.
From the 2020–21 Samba season onwards, the State government has been providing a special incentive over and above the Minimum Support Price fixed by the Union government. In the 2024–25 Samba season, a special incentive of ₹349 per quintal was fixed, taking the effective price for farmers to ₹3,350 per tonne.
Over the past five years, a total of ₹1,094 crore has been disbursed as incentive payments to 5.70 lakh farmers."
The Agriculture Budget for the year 2026–2027 is being presented by Minister M.R.K. Panneerselvam.
Finance Minister Thangam Thennarasu said, for the 2026–27 Interim Budget, the state’s own tax revenue is estimated at ₹2,29,579 crore. For 2026–2027, the State’s total outstanding debt is estimated at ₹10,62,248 crore, accounting for 26.12%.
Finance Minister Thangam Thennarasu said, in the Union Government’s 2025–2026 Budget, the funds allocated to the Tamil Nadu government were revised in the Revised Estimates, resulting in a loss of ₹1,802 crore.
"The Union Government has not released funds for schemes it is responsible for implementing. These include ₹3,548 crore under the Samagra Shiksha scheme, ₹3,112 crore under the Jal Jeevan Mission, and ₹2,246 crore recommended as grants for rural local bodies by the Finance Commission," he said.
Finance Minister Thangam Thennarasu said, despite a higher increase in tax devolution for states such as Karnataka, Tamil Nadu’s share has been raised by only 0.4 percent.
This shows that the 16th Finance Commission has abdicated its responsibility, he said.
An allocation of ₹3,934 crore has been earmarked for the Adi Dravidar and Tribal Welfare Department.
The state government announced that a ‘Ring Main Pipeline Project’ will be taken up at an estimated cost of ₹3,109 crore to interconnect all water distribution stations under the Greater Chennai Corporation and ensure uniform supply of drinking water across Chennai.
The finance minister said 30 Mudhalvar Padaippagangal (CM Spaces) are being established across Tamil Nadu at an estimated cost of ₹104 crore
An allocation of ₹11,000 crore has been made in the interim budget to implement the new pension scheme for government employees and related measures.
Further, an allocation of ₹1,55,977 crore has been made towards salaries, pensions, and related expenditures.
An allocation of ₹1,694 crore has been made for the Public Works Department.
An allocation of ₹7,547 crore has been made for the Housing and Urban Development Department.
An allocation of ₹1,943 crore has been made for the Textiles and Khadi Department.
An allocation of ₹4,435 crore has been made for the Animal Husbandry, Dairying, Fisheries and Fishermen Welfare Department.
An allocation of ₹17,068 crore has been made for the Cooperation, Food and Consumer Protection Department.
The finance minister has allocated ₹1,394 crore for the Tourism Department.
Finance Minister Thangam Thennarasu said the Tamil Nadu government implemented welfare schemes to improve living conditions in Scheduled Caste (SC) and Scheduled Tribe (ST) settlements, inspired by principles of equality and freedom, as reflected in the words of Abraham Lincoln.
"To enhance infrastructure in SC settlements, works worth ₹1,000 crore have been undertaken. Under the Ayodhya Dasan Panditar Housing Development Scheme, a total of 5886 infrastructure works have been completed at a cost of ₹482 crore. Additionally, 120 village-level community facilities have been constructed at a cost of ₹117 crore.
Similarly, for ST settlements, infrastructure facilities worth ₹1,000 crore have been implemented."
In the Interim Budget Estimates, allocations for these schemes include ₹300 crore for SC settlements and ₹855 crore for ST settlements.
₹4,000 crore has been allocated for the Magalir Vidiyal Travel Scheme. The finance minister said that, under the students’ free bus travel scheme, 1,782 students have benefited.
A diesel subsidy of ₹1,857 crore has been provided for the Transport Department, with an overall allocation of ₹13,062 crore.
The finance minister said the Tamil Nadu Government has undertaken several initiatives to expand green cover in the state, inspired by the vision of global poet Khalil Gibran, who celebrated the value of trees and nature.
Recognising the importance of forests in maintaining ecological balance, the government aims to increase forest and tree cover and achieve the national target of 33 percent green cover, he said.
"Over the past five years, 100 new protected forests have been declared across Tamil Nadu to strengthen forest conservation, enhance environmental protection, and implement measures to mitigate climate change. These initiatives also aim to safeguard ecologically sensitive areas and improve the resilience of forest lands.
To address the challenges of rapid urbanisation and climate change, the Tamil Nadu Urban Greening Committee 2026 has initiated urban greening projects. In Chennai, the Thousand-Year Park spanning 13.2 acres has been established at a cost of ₹70 crore, while the Thungapuri Park in Adyar, Chennai, covering 58 acres, has been renovated with an investment of ₹42 crore."
An allocation of ₹18,091 crore has been made for the Energy Department.
An allocation of ₹219 crore has been made for the Information Technology and Digital Services Department.
The state government said it reaffirmed its commitment to ensuring sustained growth in the Information Technology sector in Tamil Nadu. The IT sector, which accounts for an annual turnover of approximately ₹2.5 lakh crore, continues to be a major employment generator, providing direct job opportunities to a large number of skilled technology professionals across the state, the finance minister said.
"Chennai, which hosts more than 150 Global Capability Centres (GCCs), has emerged as one of India’s leading IT hubs. At the same time, cities such as Coimbatore and Madurai are significantly contributing to this growth momentum.
According to data released by the Software Technology Parks of India (STPI) under the Union Government, during 2024–25, IT exports have been recorded from 32 out of 38 districts in Tamil Nadu. This highlights the widespread expansion of the IT sector and its role in generating employment across the State.
To promote advanced research-based Artificial Intelligence (AI) innovation and support AI start-ups, Tamil Nadu has become the first State in the country to introduce a dedicated policy for the Artificial Intelligence start-up sector.
Further strengthening its position as a leader in intellectual property, Tamil Nadu has also hosted a major Intellectual Property Rights Conference in the State."
An allocation of ₹1,943 crore has been made for the Micro, Small and Medium Enterprises (MSME) Department.
To enable MSMEs to receive timely payments for goods and services supplied by them, the Tamil Nadu Government has launched the Tamil Nadu Prompt Payment System (TNPPS), said the finance minister.
"Under this scheme, so far, 1,461 industrial units have benefited, with payments amounting to ₹5,721 crore disbursed.
Over the past five years, the number of start-ups registered in the state increased fivefold, with more than 13,000 start-ups currently operating, reinforcing Tamil Nadu’s position as a leading start-up hub."
To strengthen the start-up ecosystem, the government is supporting enterprises through initiatives such as the Tamil Nadu Start-up Seed Fund and the Emerging Sector Seed Fund, among other key financial assistance mechanisms, he added.
An allocation of ₹4,882 crore has been made for the Industries, Investment Promotion and Commerce Department.
The finance minister said, in collaboration with the Indian Institute of Technology Madras (IIT Madras), works are underway to establish a Centre for Advanced Semiconductor Technologies and a Centre of Excellence for Semiconductor Design and Testing Infrastructure at Taramani in Chennai.
These initiatives aim to strengthen semiconductor research, design and technology capabilities in the State.
To prevent the discharge of sewage into rivers such as the Cauvery, Vaigai, Noyyal and Tamirabarani in the Municipal Corporations of Tiruchirappalli, Madurai, Erode, Coimbatore and Tirunelveli, riverfront development works with modern amenities are being undertaken at an allocation of ₹374 crore, Thangam Thennarasu said.
These include sewage treatment plants, pumping stations, streetlights and renovation of old parks.
To benefit students preparing for competitive examinations, knowledge and resource centres are being established in various Municipal Corporations and Municipalities at an estimated cost of ₹339 crore.
Further, 30 “Chief Minister’s Libraries” are being established across Tamil Nadu at an estimated cost of ₹104 crore for the use of students and the general public.
In the Interim Budget Estimates, an allocation of ₹28,827 crore has been made for the Municipal Administration and Water Supply Department.
An allocation of ₹22,090 crore has been made for the Health and Family Welfare Department.
The finance minister said Tamil Nadu’s government continues to prioritise public health in the spirit of Kural 949, which emphasises the physician’s duty to investigate and treat disease faithfully.
"The government successfully managed the COVID-19 pandemic and has since focused on both curative and preventive healthcare measures. Under the ‘Makkalai Thedi Maruthuvam’ scheme, medical teams visit households for screening of non-communicable diseases. So far, 2.55 crore beneficiaries have received primary services, while over 4.75 crore beneficiaries have availed follow-up services.
The ‘Innuyir Kappom – Nammai Kaakkum 48’ initiative has saved 5,11,916 lives at an expenditure of ₹493 crore.
Guided by the Chief Minister, 1,206 ‘Nalam Kaakkum Stalin’ medical camps have been conducted across the State, benefiting 17,82,687 people. Under the Chief Minister’s Comprehensive Health Insurance Scheme, approvals totaling ₹6,374 crore have been granted and 87,34,363 claims settled.
The Dr Muthulakshmi Reddy Maternity Benefit Scheme has provided financial assistance of ₹4,042 crore to 34,40,550 women over the past five years. The Cancer Management Mission has conducted awareness and screening camps in 23 districts, screening 79.17 lakh people, with 1,929 individuals diagnosed and receiving treatment.
Early detection initiatives, including the recent cervical cancer vaccination scheme for girls below 14 in Government and Government-aided schools, aim to improve outcomes.
The Arignar Anna Memorial Cancer Hospital in Kanchipuram is being upgraded into a Centre of Excellence at an estimated cost of ₹398 crore.
In recognition of these efforts, Tamil Nadu received an award from the United Nations Inter-Agency Task Force 2024 in the Health Ministries category for the effective implementation of the ‘Makkalai Thedi Maruthuvam’ scheme. In the Interim Budget Estimates, the Health and Family Welfare Department has been allocated ₹22,090 crore."
The finance minister said, to ensure a protected drinking water supply for all, 87 Combined Drinking Water Supply Schemes have been completed over the past five years at a total cost of ₹15,591 crore, benefiting more than one crore people. To ensure equitable water distribution across Chennai city by integrating all water treatment plants and distribution stations, an Integrated Urban Water Supply Scheme has been implemented at an estimated cost of ₹3,109 crore.
The 650 million litres per day (MLD) capacity Nemmeli desalination plant project is also being implemented. Further, works are underway for a 900 MLD capacity seawater desalination project to ensure a steady drinking water supply to the people of Chennai.
Additionally, 116 Combined Drinking Water Scheme improvement works have been taken up at an allocation of ₹909 crore to renovate schemes that are over 40 years old, enhance operational efficiency and augment water sources where necessary. The works are currently in progress.
An allocation of ₹1,996 crore has been made in the interim budget for the Labour Welfare and Skill Development Department. ₹28,687 crore has been allotted for the Rural Development Department, and ₹10 crore has been allocated for teaching Tamil to diaspora Tamils.
The finance minister said the Kalaignar Kanavu Illam Scheme has been launched and is being implemented successfully to construct eight lakh concrete houses and transform Tamil Nadu into a hut-free state by the year 2030.
So far:
• 1,71,000 houses have been completed.
• Construction work is underway for another 29,000 houses.
As this scheme has received an overwhelming response from the public, Thangam Thenarasu said, the Chief Minister has announced in the Assembly that an additional one lakh houses will be constructed.
Further, up to the year 2021, a total of 1,14,488 houses constructed by the Government have been renovated at a cost of ₹969 crore.
To improve transport facilities in rural areas of Tamil Nadu and to give momentum to agriculture and economic activities, the Chief Minister’s Rural Roads Development Scheme is being implemented with the objective of developing rural roads, he said.
Under this scheme:
• A total allocation of ₹8,911 crore has been made so far.
• 20,484 kilometres of roads have been upgraded.
Under the All Village Anna Renaissance Scheme (Phase II), to create necessary basic infrastructure facilities in villages:
• An allocation of ₹6,000 crore has been made so far.
• 82,488 works have been undertaken.
An allocation of ₹718 crore has been made for the Sports and Youth Welfare Department. An allocation of ₹718 crore has been made for the Sports and Youth Welfare Department.
₹5,463 crore has been allocated to the social security pension scheme for widows, destitutes and the elderly. An allocation of ₹28,827 crore has been made for the Municipal Administration and Water Supply Department.
An allocation of ₹8,550 crore has been made for the Higher Education Department and ₹48,534 crore for school education in the interim budget.
Thangam Thennarasu said laptops have been distributed to 6.65 lakh students so far.
As Tamil Nadu's interim Budget is being presented, the opposition AIADMK has released a card mocking it as an “ear-piercing ceremony” (kathu kuthu vizha), ridiculing the government’s announcements.
During his address, Thangam Thennarasu said that works are under way to translate the Thirukkural into various languages. Sharing his remarks in the House, Thennarasu said Tamil Nadu’s schemes are being followed by other States, and that their success is evident from this fact.
He stated that the Tamil Nadu government is functioning with determination to protect Tamil from the dominance of other languages. “We have launched the final battle to eradicate poverty in Tamil Nadu,” he said.
As part of this effort, a grand plan has been devised to boost exports, reduce inflation, and safeguard the welfare of workers. He noted that the recent credit of ₹5,000 into the bank accounts of 1.31 crore women has drawn national attention. Funding for women’s self-help groups has been increased, he added.
“We have achieved unprecedented growth in food production,” the Minister said.
He also mentioned that several museums have been established to celebrate Tamil pride, and that schemes will be formulated to help youth grow in emerging sectors, including artificial intelligence.
The works of Periyar EV Ramasamy have been translated into 27 languages, including Gujarati, French, and Arabic, he said.
“We are fulfilling a historic responsibility of guiding the nation,” he added, reiterating that Tamil Nadu has launched the final battle to eliminate poverty.
The presentation of the interim Budget for the financial year 2026–2027 by Finance Minister Thangam Thennarasu has commenced in the Tamil Nadu Legislative Assembly.
