In the budget for the year 2026-2027, the Tamil Nadu government has announced that it plans to raise Rs. 1 lakh 73 thousand 445 crore as new debt. At the same time, it also plans to repay old debts worth Rs. 51 thousand 971 crore.
According to the budget, the government has said that the revenue deficit will gradually decrease due to improved tax administration, enhanced tax collection efficiency, and revenue-boosting measures undertaken with the aim of increasing the state's revenue.
The revenue deficit, estimated at Rs. 55,775 crore in 2026-2027, is projected to decline to Rs. 53,993 crore in 2027-2028.
It is also stated in the financial statement that, in order to strengthen the state's fiscal discipline, the ratio of the fiscal deficit to the Gross State Domestic Product (GSDP) will decline to 2.80 percent in 2028-2029.

With regard to the overall debt position, taking into account the new borrowing plan and debt repayment measures, the government has estimated that as of March 31, 2027, the Tamil Nadu government’s total outstanding debt will be Rs. 10 lakh 98 thousand 768 crore.
The government has explained that these projections in the budget document, on the one hand, indicate that the state’s debt burden continues to rise, while on the other hand, efforts are being made to bring the revenue deficit under control.
Key points:
* New borrowing: Rs. 1,73,445 crore
* Debt repayment plan: Rs.51,971 crore
* Revenue deficit in 2027-28: Rs.53,993 crore
* Fiscal deficit in 2028-29: 2.80% of GSDP
* Total government debt as of March 31, 2027: Rs.10,98,768 crore
