Chennai: In the Union Budget for 2026-27, presented by Finance Minister Nirmala Sitharaman, Tamil Nadu received targeted allocations focused on modern transport, industrial raw materials, and cultural infrastructure, though the announcements fell short of the state’s comprehensive wish-list ahead of Assembly elections. The budget prioritized long-pending connectivity projects and positioned the state as a strategic hub for future-facing industries.
Key infrastructure wins: High-Speed Rail green light and rare earth corridor
The budget delivered a major win with the approval of two critical High-Speed Rail corridors linking Chennai with Bengaluru and Hyderabad, part of a national network of seven. This is expected to halve travel times and integrate South India’s economic hubs. In a significant industrial move, Tamil Nadu was named one of four states to host a new “Rare Earth Corridor,” establishing it as a future centre for refining minerals essential for electric vehicles and defence manufacturing.
Cultural & tourism push: Adichanallur’s makeover and eco-tourism initiatives
The ancient archaeological site of Adichanallur was selected as one of India’s 15 major archaeological tourist destinations. The budget proposed transforming it into a world-class “Experiential Cultural Centre” with walkways and digital interpretation centres at excavation sites. For tourism, the budget announced new bird-watching towers at Pulicat Lake and eco-trekking programs in the Podhigai Hills.
Sectoral Support: Textiles, Agriculture
The Tiruppur knitwear hub is expected to benefit from the new “Integrated Scheme for the Textile Sector,” aimed at helping the industry offset the impact of a 50% US import duty by reducing production costs. For agriculture, a new scheme to promote coconut cultivation in coastal areas was announced, focusing on replacing old trees with high-yield saplings and boosting value-added products.
Notable Omissions: A Mixed Reaction in Tamil Nadu
The budget, however, drew mixed reactions for its omissions. It did not mention fresh funding for the Coimbatore and Madurai metro rail projects, nor did it announce additional funds to accelerate the construction of Madurai AIIMS. The absence of any mention of the Keeladi archaeological site, a project strongly championed by the state government, also sparked political debate, highlighting the gap between central allocations and regional expectations.