DMK and AIADMK Lock Horns Over Tamil Nadu's Economic Health in Budget Session
The political arena in Tamil Nadu witnessed a fierce confrontation as the DMK and AIADMK clashed over the state's economic trajectory and escalating debt during the debate on the interim budget for the fiscal year 2026-27. The session, held in Chennai, saw intense exchanges between the ruling and opposition parties, highlighting deep-seated concerns about financial management and growth prospects.
AIADMK Raises Alarms Over Debt and Growth Targets
Former AIADMK minister K P Munusamy ignited the debate by questioning whether Tamil Nadu could achieve its ambitious target of becoming a one trillion-dollar economy by 2030, given its current growth pace. He pointed out that the state's debt has surged past the ₹10 lakh crore mark, a significant increase from previous years. Munusamy drew a stark comparison with Uttar Pradesh, noting that despite UP having twice the population of Tamil Nadu, its debt stands at approximately ₹7 lakh crore, while Tamil Nadu's debt has ballooned to ₹10.71 lakh crore.
He criticized the DMK regime, stating, "We (AIADMK) ruled the state till 2021, and the total debt was ₹5 lakh crore. But this government borrowed ₹5.50 lakh crore in the last five years. This stands testimony to the present dispensation's poor governance and financial management." Munusamy's remarks underscored the AIADMK's contention that the current administration's fiscal policies are unsustainable and detrimental to the state's economic health.
DMK Defends Economic Performance and Accuses Central Discrimination
In response, Finance Minister Thangam Thennarasu defended the state's economic record, highlighting that Tamil Nadu has achieved a double-digit economic growth rate of 11.19% despite the debt burden. He countered Munusamy's comparison with Uttar Pradesh by accusing the Union government of discriminatory practices. Thennarasu argued that the Centre has provided substantial financial support to UP while imposing artificial constraints on Tamil Nadu, thereby hindering its development.
Thennarasu emphasized, "The Union government assisted and extended financial support to Uttar Pradesh, while following discriminatory approaches towards Tamil Nadu. This has created artificial financial constraints for our state." His statement reflected the DMK's ongoing grievance against the BJP-led central government, alleging bias in fund allocation and policy implementation.
Debate Extends to Agricultural Sector and Discontinued Projects
AIADMK General Secretary Edappadi K Palaniswami joined the fray, focusing on the agricultural sector, which he noted supports 65% of the state's population. He highlighted a decline in agricultural growth, from around 5% in 2020-21 to 3.8% in 2025-26, criticizing the DMK government for failing to bolster this crucial sector. In reply, Thennarasu assured that the state is actively working to improve growth in agriculture and allied sectors through targeted initiatives.
DMK MLA N Ezhilan further escalated the debate by accusing the BJP government at the Centre of waging an "economic war on Tamil Nadu" through inadequate fund allocation. He pointed out that the Centre's fund allocation to Tamil Nadu increased by a mere 0.44%, while other states saw double-digit increases. Despite this, Ezhilan noted that Tamil Nadu continues to grow in double digits and maintains its fiscal deficit under 3.5%, as mandated by the FRBM Act, showcasing the state's resilience and prudent fiscal management.
Additionally, the debate turned heated over the issue of discontinued projects, with both parties trading accusations about the handling of development initiatives. The DMK accused the AIADMK of halting key projects during their tenure, while the AIADMK blamed the current government for mismanagement and delays.
Implications for Tamil Nadu's Future
This budget debate underscores the deep political divisions in Tamil Nadu regarding economic policy and governance. The AIADMK's focus on rising debt and agricultural decline contrasts sharply with the DMK's emphasis on growth achievements and allegations of central discrimination. As the state navigates its path toward economic milestones, these debates are likely to shape public discourse and policy decisions in the coming years.
The session highlighted critical issues such as:
- The sustainability of Tamil Nadu's debt levels amid growth targets.
- The impact of central fund allocation on state development.
- Challenges in revitalizing the agricultural sector.
- Political accountability for discontinued projects and governance.
With both parties firmly entrenched in their positions, the economic future of Tamil Nadu remains a contentious topic, poised to influence upcoming elections and budgetary allocations.
