Tamil Nadu News

White Paper on State Finances 2026

June 18 , 2026 15 hrs 0 min 97 0

The Tamil Nadu government released a White Paper on State Finances (2021–22 to 2025–26), presenting the State's fiscal position and debt status.
The White Paper stated that Tamil Nadu's total outstanding debt is ₹13.18 lakh crore, and each child born in the State carries an estimated debt burden of ₹1.28 lakh.
The White Paper stated that the headline debt of ₹10 lakh crore represents only the Tamil Nadu government's direct borrowings, including market loans, institutional debt, and public account liabilities.
It does not include the debts of Public Sector Undertakings (PSUs), statutory boards, and special purpose vehicles (SPVs) that are guaranteed or supported by the State government.
The power sector is the largest source of PSU debt, accounting for ₹2.47 lakh crore, with major liabilities from the Tamil Nadu Power Distribution Corporation Limited (TNPDCL) and Tamil Nadu Power Generation Corporation Limited (TNPGCL).
Tamil Nadu's debt-to-Gross State Domestic Product (GSDP) ratio stood at 28.3% in 2025–26, while the revenue deficit reached ₹78,324 crore, the highest in absolute terms.
Interest payments in 2025–26 amounted to ₹67,050 crore, consuming about 23% of total revenue receipts and exceeding the State's annual capital expenditure by nearly one-third.
The White Paper highlighted a declining working-age population and projected that elderly people will constitute 18.2% of Tamil Nadu's population by 2031.
It stressed the need for revenue mobilisation, expenditure management, Public Sector Undertaking (PSU) reforms, and effective debt management to improve the State's fiscal position.