Ambitious ‘New Industrial Policy’ In Poll-Bound Tamil Nadu:  Where Will the Money Come from?

Ambitious ‘New Industrial Policy’ In Poll-Bound Tamil Nadu: Where Will the Money Come from?

February 18, 2021 0 By Raju Kumar

Ahead of Assembly elections, AIADMK government recently announced ambitious ‘New Industrial Policy’ aiming at Rs 10 lakh crore new investments and creation of 20 lakh jobs by 2025. But the question is from where the money will come. Here are highlights of the financial condition of poll-bound Tamil Nadu.

TN signs 28 new MoUs with corporates including TATA Electronics and Pegatron Corporation. New Industrial Policy aims Rs 10 lakh crore in new investments and creates 20 lakh jobs by 2025.

In-between 2014-15 and 2019-20 Tamil Nadu achieved a compounded annual growth rate of 13% in manufacturing and is well-positioned to attain a target growth of 14%. Govt aims to attract investment of Rs 27,000 crore in automobile, electric vehicles manufacturing, food processing.

Revised TN Budget 2019-20

  • Total Expenditure-2,70,256 crore
  • Borrowings-67,838 crore
  • Total Receipts- 2,65,172 crore
  • Revenue Deficit- 25,072 crore
  • Fiscal Deficit- 55,058 

Break up of state government receipts (Rs crore) –

  • State’s Own Tax-   1,20,810 
  • State’s Own Non-Tax-      14,195 
  • Share in Central Taxes-   26,392 
  • Grants-in-aid from Centre- 30,464 
  • Total Revenue Receipts- 1,91,861
  • Borrowings-   67,838
  • Other receipts-     5,473 
  • Total Capital Receipts- 73,311 
  • Total Receipts-   2,65,172 

Current Budget in a nutshell- 

  • Gross State Domestic Product of Tamil Nadu for 2020-21 (at current prices) is projected to be Rs 20,91,927 crore.
  • Total expenditure for 2020-21 is estimated to be Rs 3,00,390 crore, an 11.2% increase over the revised estimate of 2019-20
  • Total receipts (excluding borrowings) for 2020-21 are estimated to be Rs 2,24,739 crore, an increase of 13.9% as compared to the revised estimate of 2019-20.
  • Revenue deficit for 2020-21 is targeted at Rs 21,618 crore or 1.03% of the Gross State Domestic Product (GSDP).   The fiscal deficit is targeted at Rs 59,346 crore (2.84% of GSDP).  

Economy of Tamil Nadu’s at a glance-

  • GSDP:  The growth rate of Tamil Nadu’s GSDP (at constant prices) has increased from 7.2% in 2016-17 to 8.2% in 2018-19.
  • Sectors:  In 2018-19, agriculture, manufacturing, and services contributed to 12%, 36% and 52% of the GSVA, respectively.  In the same year, these sectors grew by 9.9%, 6.6% and 8.2%, respectively.
  • Per capita income:  The per capita GSDP of Tamil Nadu in 2018-19 (at constant prices) was Rs 1,56,041. This is 7% higher than that in 2017-18.