Chennai, — tamil Nadu Finance minister Thangam Thennarasu presented the interim budget for 2026–27 today, highlighting a stark discrepancy between the state’s requested funds from the Union government and the actual allocation.

The state had requested ₹50,900 crore in central assistance for various development and welfare schemes. However, the Union government approved only ₹1,151 crore, effectively creating what the Finance minister described as an artificial fiscal squeeze on the tamil Nadu budget.

Details from the Interim Budget Presentation

During the presentation at the Chennai Secretariat, Finance minister Thangam Thennarasu outlined the key points of the interim budget:

Total expenditure proposed for 2026–27:

Fiscal deficit concerns due to lower-than-requested central grants

Emphasis on continuing welfare and development schemes despite constrained funds

The Finance minister emphadata-sized that Tamil Nadu will continue to prioritize social welfare, education, health, and infrastructure despite the shortfall in central assistance.

State’s Perspective on Central Allocations

Minister Thennarasu noted that the limited allocation from the Union government was artificially constraining the state’s fiscal space:

The request of ₹50,900 crore reflected the actual need for ongoing schemes, developmental projects, and welfare programmes.

Receiving only ₹1,151 crore would significantly limit implementation of many flagship initiatives.

The state government is likely to seek alternative financing mechanisms, including increased revenue collection and efficient utilisation of resources, to ensure critical programmes continue without disruption.

Impact on Welfare and Development Schemes

Key sectors likely affected by the funding gap include:

Health and education programmes across the state

Infrastructure development, including roads, irrigation, and urban projects

Agriculture and farmer support schemes, especially in light of recent initiatives like Mannuyir Kaappom and fallow land conversion

Social welfare initiatives targeting vulnerable communities

The Finance minister reiterated the government’s commitment to maintaining the momentum of development while ensuring fiscal prudence.

Next Steps

Tamil Nadu officials plan to engage with the Union Government to secure additional funding, while also optimizing state resources to mitigate the impact of the central allocation shortfall. The interim budget serves as a bridge to the full 2026–27 budget, which will be presented after more detailed revenue and expenditure assessments.

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