CHENNAI: Finance Minister Thangam Thennarasu on Thursday mounted a detailed defence on the state’s fiscal management, rebutting allegations made by leader of opposition Edappadi K Palaniswami over rising debt and fiscal deficit.
Intervening during a debate, Thennarasu said debt and financial management must be assessed comparatively. He noted that during the AIADMK regime between 2011-16, the state’s outstanding debt rose from Rs 1,01,349 crore to Rs 2,11,066 crore, a growth of 108%. Between 2016 and 2021, debt further increased to around Rs 4.8 lakh crore, marking a 128% rise.
When the DMK assumed office in 2021-22, the debt stood at Rs 4.8 lakh crore, he said. By the end of 2025-26, it is projected to reach Rs 9,42,851 crore, a 96% increase over five years, which he argued was lower than the debt growth rate recorded under the previous regime.
The minister stressed that borrowings were maintained within the limits prescribed by the Finance Commission. For 2025-26, while the permissible debt ceiling was 28.7% of GSDP, Tamil Nadu’s debt stood at 26.43%, he said.
Thennarasu also pointed out that the state’s share in central tax devolution had declined from 7.9% during the Ninth Finance Commission period to 4.07% now, resulting in an estimated cumulative loss of over Rs 3 lakh crore. “Had we got these funds, the debt burden would have significantly come down,” the FM said.
On fiscal indicators, he said the fiscal deficit had reduced from 4.6% in 2020-21 to 3.48% in 2025-26, while the revenue deficit had narrowed from 3.49% to 1.94%. He added that the state’s GSDP growth had doubled from 52% to 100% under the present regime.
Thennarasu maintained that the government had handled finances prudently, guided by consultations with expert committees.