Chennai: With regard to the Tamil Nadu government's public debt, the government has planned to borrow a total of Rs. 1,73,445 crore and repay Rs. 51,971 crore in the current 2026-27 financial year.
In this regard, the Tamil Nadu government's budget states: Liabilities under the public account are also accounted for along with public debt. In the interim budget for 2026-27, the estimated net public debt and public account liabilities stand at Rs. 1,21,653 crore, while in the revised budget estimates they stand at Rs. 1,20,964 crore. As a result, the outstanding liabilities in 2027 will be Rs. 10,98,768 crore.
The ratio of total outstanding liabilities to the State Gross Domestic Product is expected to further decline to 26.57% in 2027-28 and 26.10% in 2028-29. Through this, the State aims to maintain debt sustainability as part of its fiscal consolidation roadmap.
A path looking to the futureAlthough the State’s finances are currently facing a crisis due to the debt burden arising from the administrative shortcomings of the previous government, this Medium-Term Fiscal Plan sets out a decisive, forward-looking path to restore fiscal balance and structural strength over the next three years.
Under the guidance of the High-Level Revenue Enhancement Committee and the Expenditure Rationalization Committee, the government is formulating a comprehensive action plan to systematically plug revenue leakages, streamline expenditures, and improve public welfare services. It is designed to control the fiscal deficit while pursuing growth through clean, transparent, and improved governance over the next 2 years.
Wasteful expenditures will be reduced: Public debt will be brought under control by effectively expanding revenue sources and reducing wasteful expenditures. The budget speech states that Tamil Nadu, with its strong institutional strength, excellent industrial environment, and dynamic human resources, will achieve sustained economic health through such reform measures and emerge as an excellent model for long-term, stable, and inclusive economic growth.
