CHENNAI: With faster economic growth boosting the prospects, Tamil Nadu is poised to reach the $1 trillion economy mark by 2031, a milestone expected to generate better jobs and higher incomes, though a stronger US dollar may slightly delay the timeline, the Economic Survey of Tamil Nadu (EST) for 2025-26 released on Monday said.
The survey underscored the fact that TN’s per capita income growth has consistently outpaced the national average. In 2024-25, TN’s per capita income reached Rs 3.62 lakh, which is 1.77 times the national average of Rs 2.05 lakh, making Tamil Nadu the third-largest state in India in terms of per capita income.
“Tamil Nadu aspires to become a trillion-dollar economy by 2030, a goal that carries transformative potential for its 7.7 crore citizens, particularly the youth seeking quality jobs and higher incomes. The prospect of achieving the target has significantly improved due to the recent surge in economic growth.
If TN sustains its 2024- 25 nominal growth rate of 16% and assuming a 2% (medium-term) rise in the value of dollar against rupee per annum, it can achieve the trillion-dollar milestone by 2031. With 3.5% (short-term rise in dollar value), it may be delayed for a year,” the report, released by Chief Minister MK Stalin, said.
The 263-page report, compiled from papers submitted by 17 research scholars under 10 broad heads, traces the trajectory of the state’s economy over the past five years. It not only highlights the state’s economic performance but also identifies areas of concern that need to be addressed to achieve the twin targets of trillion-dollar economy and per capita income on a par with developed countries.
The EST said TN’s industrial policies continue to attract robust domestic and global investments and highlighted other positive aspects of the state, such as strong international connectivity and first place in manufacturing employment, etc.
TN remained resilient despite global headwinds: Survey
The survey noted that TN’s textile exports faced strain due to the 50% tariff imposed by the US as nearly 30% of shipments were bound for that country. While the India-EU free trade pact and India-US trade agreement, which will reduce US tariffs to 18%, may ease the pressure on exporters, the state is also diversifying its export market, and the temporary suspension of 11% cotton customs duty has also offered some relief.
Noting that post-pandemic recovery coincided with major policy shifts reshaping global trade, the EST said that since February 2025, multiple rounds of US tariffs and retaliatory measures heightened trade uncertainty.
While the global economy grew at 3.3% in 2025, India’s economy recorded 6.49% growth in 2024-25, and increased to 7.4% in 2025-26. Despite global headwinds, TN remained resilient.
The survey also pointed out that TN’s sustained high performance has significantly contributed to India’s overall economic progress. Despite accounting for only 4% of India’s land area and 6% of its population, the state contributed 9.4% to the national GDP in 2024-25. Its Gross State Domestic Product at current prices reached Rs 31.19 lakh crore in 2024-25, reflecting nominal growth of 16% and real growth of 11.2%, the highest among major states.
Though both TN and India recorded an average inflation rate of 5.7% from 2020-21 to 2024-25, TN ranked 10th lowest in retail inflation among 18 major Indian states in 2024-25. Urban inflation in TN declined from 5.2% in 2023-24 to 2.5% in 2025-26, while rural inflation fell from 5.8% to 2.1%.
The survey said at its present pace of 15.98% nominal growth, TN is on track to cross the high-income country threshold of US$16,122 by 2034-35.
Key highlights of TN Economic Survey 2025-26
TN contributed 9.4% to national GDP in 2024–25, GSDP touched 31.19 lakh crore
Labour force participation rose to 72.1%, unemployment dropped to 3.5%
Social sector expenditure rose to Rs 1,57,864 crore in 2025–26
Contributions to GSVA in 2024-25 — Primary sector: 13.4%, secondary sector: 33.1%, services sector: 53.6%
TN’s FDI inflows rose to US$3,681 million in 2024–25
Per capita income Rs 3.62 lakh in 2024–25, 1.77 times the national average
In 32 districts, per capita income exceeded national average
TN inks MoUs for Rs 6,000 crore investments
Chennai: The state on Monday signed Rs 6,000 crore worth MoUs with the Indian arm of Japanese electronics major MinebeaMitsumi and Karnataka-based aerospace manufacturer Aequs Group. The pacts, signed in the presence of CM Stalin, may generate around 8,400 jobs.