CHENNAI: The Tamil Nadu government on Tuesday presented an expansive Interim Budget for 2026–27, earmarking Rs 48,534 crore for School Education, Rs 22,090 crore for Health, Rs 28,687 crore for Rural Development and Rs 18,091 crore for Energy, while reaffirming its focus on social welfare, industrial expansion and climate resilience.
Presenting the Interim Budget in the Assembly, Finance Minister Thangam Thenarasu outlined sector-wise allocations spanning education, health, industry, infrastructure and welfare, underscoring the government’s stated goal of combining economic growth with social justice.
The School Education department has been allocated Rs 48,534 crore, while Higher Education will receive Rs 8,505 crore. A Rs 2,172 crore laptop scheme for 10 lakh college students is under implementation, and Anna University is being upgraded under a Rs 1,380 crore project.
Under the ‘Naan Mudhalvan’ initiative, 48.65 lakh skill certificates have been issued, and 52 of the 59 successful Civil Services candidates from Tamil Nadu in 2025 were beneficiaries of the scheme. The Special Programme Implementation department has been allocated Rs 17,088 crore.
The Health and Family Welfare department has been allotted Rs 22,090 crore. Insurance approvals worth Rs 6,374 crore have been granted under the Chief Minister’s Comprehensive Health Insurance Scheme. The government also announced cervical cancer vaccination for girls below 14 years in government and aided schools and a Rs 398 crore upgrade of the Arignar Anna Memorial Cancer Hospital.
A sum of Rs 1,471 crore has been earmarked for the Welfare of Differently Abled Persons, and Rs 5,463 crore for social security pensions benefiting 35.33 lakh individuals.
Rural Development and Panchayat Raj has been allocated Rs 28,687 crore, while Municipal Administration and Water Supply will receive Rs.28,227 crore. The Water Resources department has been allotted Rs 10,076 crore, including works for flood mitigation and a new 2.25 TMC ‘Mamallan Reservoir’ near Chennai at Rs 342 crore.
The Industries department has been allocated Rs 4,282 crore. The State has signed 1,179 MoUs committing investments of Rs 12.37 lakh crore, projected to create 36 lakh jobs.
For MSMEs, Rs 1,943 crore has been earmarked, while the Information Technology and Digital Services department will receive Rs 219 crore. The Tamil Nadu Semiconductor Mission-2030 will be implemented at an estimated cost of Rs 500 crore.
The Energy department has been allocated Rs 18,091 crore, alongside plans for 100 billion units of renewable energy and a 1,000 MW pumped storage project in Kanniyakumari district at Rs 5,320 crore.
The Budget reiterates the government’s climate commitments, with Tamil Nadu ranking first in the Climate Action category in the SDG India Index 2023–24.
Framing the Budget as an instrument of planned development, the Minister said the government would continue to mobilise resources to sustain welfare commitments while accelerating growth across sectors.
The Transport department has been allocated Rs 13,062 crore in the Interim Budget. Over the past five years, Rs 6,121 crore has been spent on procuring 12,087 new buses, while Rs 374 crore has been allocated for refurbishing 3,673 buses. As part of the green mobility push, 380 electric buses have been inducted at a cost of Rs 288 crore. The Budget provides Rs 4,000 crore for the Vidiyal Payanam scheme, Rs 1,782 crore for the Student Bus Fare scheme, and Rs 1,857 crore towards diesel subsidy. A Rs 2,000 crore Viability Gap Fund has also been created to strengthen State Transport Undertakings.
For the Highways and Minor Ports department, an allocation of Rs 21,132 crore has been made. Over the last five years, 1,085 km of roads were taken up for four-laning at Rs 8,313 crore. In addition, 42 high-level bridges, 46 railway overbridges and 30 bypass projects have been undertaken, along with elevated corridors and flyovers in key cities.
Construction of Phase II of the Chennai Metro Rail project, spanning 118.9 km across three corridors at an estimated cost of Rs 63,246 crore, is progressing. The State has also accorded in-principle approval for new metro corridors connecting Chennai Airport–Kilambakkam, Koyambedu–Avadi and Poonamallee–Sunguvarchathiram, pending Union approval and financial support.
The Industries, Investment Promotion and Commerce department has been allocated Rs 4,282 crore. As part of its sectoral push, the government announced that the Tamil Nadu Shipbuilding Policy will be released shortly to position the State as a global hub for shipbuilding and marine ancillary manufacturing. A new shipbuilding cluster is being established at Thoothukudi in association with the V O Chidambaranar Port Authority at an estimated cost of Rs 5,200 crore through a Special Purpose Vehicle. Memoranda of Understanding have been signed with leading shipbuilding firms, including Union government public sector undertakings and a global shipbuilding company, entailing investment commitments of around Rs 30,000 crore.
The Housing and Urban Development department has been allocated Rs 7,547 crore. Over the last five years, Rs 11,708 crore has been spent through the Tamil Nadu Urban Habitat Development Board for housing projects, including 2.21 lakh beneficiary-led houses and thousands of tenements for economically weaker sections. The ‘Chennai One’ integrated ticketing mobile application has crossed 10.5 lakh downloads.
For Adi Dravidar and Tribal Welfare, the Budget earmarks Rs 3,934 crore, including Rs 300 crore for the Iyothee Thass Pandithar Habitation Development Scheme and Rs 255 crore for the Tholkudi scheme. Entrepreneurship support continues under CM ARISE and the Annal Ambedkar Business Champions Scheme.
The Backward Classes, Most Backward Classes and Minorities Welfare department has been allocated Rs 1,634 crore, including Rs 460 crore for scholarships and Rs 78 crore for hostel infrastructure. Minority welfare measures include scholarships, renovation of places of worship and construction of a Haj House in Chennai.
The Tourism, Culture and Religious Endowments department has been allocated Rs 1,394 crore. A new Tourism Policy has been released, and MoUs worth Rs 22,794 crore were signed at the Global Tourism Summit. An allocation of Rs 100 crore has been made to develop 22 lesser-known tourist destinations, and a Special Area Development Authority will be set up in Mamallapuram.
The Cooperation, Food and Consumer Protection department has been allocated Rs 17,068 crore, including Rs 14,000 crore towards food subsidy. Loan waivers covering crop, jewel and SHG loans were reiterated, while Rs 69,087 crore in crop loans has been disbursed over the past five years.
The Animal Husbandry, Dairying, Fisheries and Fishermen Welfare department has been allocated Rs 4,435 crore, with continued focus on fisheries infrastructure and enhanced relief assistance to fisherfolk.
For the Handlooms, Handicrafts, Textiles and Khadi department, Rs 1,943 crore has been allocated, including Rs 612 crore for the Free Dhoti and Saree Distribution Scheme, alongside new handloom parks and a silk park in Arani to boost production and employment.