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Tamil Nadu Eyes $1 Trillion Economy by 2031, Says State Economic Survey

The Tamil Nadu Economic Survey 2025-26 projects the state can achieve a $1 trillion economy by 2031 if it sustains its current high growth trajectory. It highlights the state's economic resilience, with a GSDP growth of 16% and a per capita income significantly above the national average. However, challenges persist, particularly for textile exports facing heightened US tariffs. The report credits disciplined fiscal management, sustained investment, and inclusive welfare policies for the strong performance.

Key Points: TN $1 Trillion Economy Goal by 2031 - Economic Survey

  • $1 trillion target by 2031
  • 16% nominal GSDP growth in 2024-25
  • Textile exports face US tariff headwinds
  • Per capita income 1.77x national average
  • Fiscal consolidation & high social spending
2 min read

TN on track for $1 trillion economy by 2031, says state Economic Survey 2025-26

Tamil Nadu's Economic Survey projects a $1 trillion economy by 2031, highlighting 16% growth, resilience, and key challenges like textile exports.

"Tamil Nadu's development model... balances economic growth with social justice - J. Jeyaranjan"

Chennai, Feb 16

Tamil Nadu can achieve its ambitious $1-trillion economy milestone by 2031 if it sustains its 2024-25 nominal growth rate of 16 per cent, according to the Economic Survey of Tamil Nadu 2025-26.

The projection assumes a medium-term 2 per cent annual appreciation in the value of the US dollar against the rupee.

If the dollar strengthens at a higher short-term rate of 3.5 per cent annually, the milestone could be delayed by a year, the Survey noted.

The 263-page report, prepared by the State Planning Commission (SPC) with inputs from the Finance Department and subject experts, was handed over to Chief Minister M.K. Stalin on Monday.

In his foreword, SPC Executive Vice Chairman J. Jeyaranjan described Tamil Nadu's development model as one that balances economic growth with social justice, resulting in sustained double-digit growth led by the secondary sector.

Despite global trade uncertainties, including multiple rounds of US tariff hikes since February 2025, Tamil Nadu's economy remained resilient.

The state's Gross State Domestic Product (GSDP) at current prices reached Rs 31.19 lakh crore in 2024-25, registering a nominal growth of 16 per cent and a real growth of 11.2 per cent - the highest among major states.

Tamil Nadu contributed 9.4 per cent to India's GDP, despite accounting for just 4 per cent of the country's land area and 6 per cent of its population. Per capita income rose to Rs 3.62 lakh in 2024-25, 1.77 times the national average of Rs 2.05 lakh, making Tamil Nadu the third-largest state in per capita income terms.

However, the Survey flagged challenges, particularly in textile exports, which face headwinds due to a 50 per cent hike in U.S. tariffs. Nearly 30 per cent of the state's textile exports go to the US. While the Centre's suspension of 11 per cent customs duty on cotton offers temporary relief, diversification of export markets and recent India-EU and India-US trade agreements are expected to cushion the impact.

Fiscal consolidation remains steady, with capital expenditure between 2020-21 and 2025-26 touching Rs 2.54 lakh crore. Social sector spending increased significantly, supporting flagship schemes such as Naan Mudhalvan, Pudhumai Penn, and Kalaignar Magalir Urimai Thittam. Inflation has moderated sharply, with urban inflation falling to 2.5 per cent and rural inflation to 2.1 per cent in 2025-26.

The Survey concludes that disciplined fiscal management, sustained investment, and inclusive welfare policies will be key to realising Tamil Nadu's trillion-dollar aspiration.

- IANS

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Reader Comments

P
Priya S
Great to see the focus on social justice alongside economic numbers. Schemes like Kalaignar Magalir Urimai Thittam are vital. However, the projection seems very optimistic and hinges on that 16% growth rate. Global headwinds, especially for textiles, are a real concern. Hope the diversification plans work out.
R
Rohit P
As someone from another state, I have to appreciate TN's consistent performance. Contributing 9.4% to India's GDP with only 6% of the population is no small feat. Other states should definitely take notes on their balanced approach to development.
S
Sarah B
The resilience shown despite US tariff hikes is impressive. It shows a mature economy that's not overly dependent on one market. The capital expenditure figure of ₹2.54 lakh crore over 6 years is massive and should build a strong foundation for the future.
A
Aman W
All this is good, but what about job creation for the youth? High GSDP numbers are one thing, but are enough quality jobs being generated? Hope schemes like Naan Mudhalvan are effectively bridging the skill gap. The real test is translating this growth into widespread employment.
K
Kavya N
The low inflation numbers, especially in rural areas, are a huge relief for common people. It means the growth is not coming at the cost of high prices. Balancing welfare and capital expenditure without fiscal slippage is the key achievement here. More power to TN!

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