With 11.2% growth, Tamil Nadu eyes $1 trillion status by 2031: State economic survey

CHENNAI: Tamil Nadu clocked a robust economic growth of 11.2%, the highest among major states in 2024-25, according to the Economic Survey of Tamil Nadu 2025-26 released on Monday.The gross state domestic product (GSDP) reached Rs 31.19 lakh crore (at current prices), accounting for a nominal growth rate of 16% and a real growth rate of 11.2% in 2024-25. The survey said that if the growth rate is sustained and there is a rise in the value of the dollar against the rupee, Tamil Nadu would achieve its goal of being a trillion-dollar economy in 2031, a year later than its original target of 2030.A simple linear trend projection based on the past four years’ growth rates indicates that the state’s economy could grow by 11.88% in 2025-26, reinforcing its trajectory as one of India’s most dynamic and rapidly expanding state economies, the survey said. The report, prepared by the State Planning Commission and released by chief minister M K Stalin, attributed the momentum to targeted investments, strengthened industrial infrastructure and supportive policies.The survey highlighted a sharp rise in social sector spending, which increased by more than Rs 44,500 crore in the past four years, from Rs 1.13 lakh crore in 2021-22 to Rs 1.58 lakh crore in 2025-26, reflecting the govt’s focus on inclusive development.The manufacturing sector recorded a real growth rate of 14.74% in 2024-25, three times the national average of 4.5%, the survey report said. Tamil Nadu led the nation with an average manufacturing growth rate of 9.38%. TN continues to rank among the top Indian states in attracting foreign direct investment. “While India’s overall FDI equity inflows declined, TN defied the trend. The state’s FDI inflows increased steadily from 2,169 million USD in 2022-23 to 2,436 million USD in 2023-24 and further to 3,681 million USD in 2024-25,” the report said.TN consistently ranked first in exports of electronics, textiles, and leather products, while the state was second in engineering exports, the report said. “It not only highlights the stellar performance of the state’s economy but also identifies areas of concern,” TN State Planning Commission executive vice-chairperson J Jeyaranjan said. Retail inflation in the state showed a downward trend, declining from 5.9% in 2022-23 to 2.3% in 2025-26 (as of Dec 2025), reflecting effective supply chain management, market intervention mechanisms, and overall economic governance, the report said.The survey noted that schemes such as Naan Mudhalvan, Pudhumai Penn, Tamizh Pudhalvan, CM’s Breakfast Scheme, Kalaignar Magalir Urimai Thittam and large-scale housing and urban renewal initiatives expanded human capabilities and reduced household risk.In 2024-25, the primary sector grew by 3.18%, supported by strong performance in forestry (8.77%) and fishing (9.89%), though agriculture again recorded negative growth (-1.83%). The survey said approximately two lakh hectares of net sown area declined since 2001-02, in addition to a rise in fallow land, indicating underutilised cultivable land. Jeyaranjan said rapid industrial growth steadily reduced agriculture’s share in the state economy. Only about 25% of the population now depends on agriculture. The sector’s contribution to GSDP continues to decline, a pattern typical of developed economies, where agriculture accounts for just 4-6%, he said.