TN Economic Survey: State posts decade-high growth in 2024-25, targets USD 1-tn economy
Economic Survey 2025–26 reports 11.19 per cent real GSDP growth, record exports, and rising per capita income
Tamil Nadu recorded its strongest economic performance in over a decade in 2024–25, emerging as the fastest-growing state in India with a real Gross State Domestic Product (GSDP) growth rate of 11.19 per cent, according to the Economic Survey of Tamil Nadu 2025–26.
At current prices, the state’s GSDP reached ₹31.19 lakh crore, marking a nominal annual growth of nearly 16 per cent and significantly outpacing the national average growth of 6.5 per cent. The budget document projects Tamil Nadu’s nominal GSDP at Rs. 36.57 lakh crore in 2025-26 and Rs. 41.03 lakh crore in 2026-26.
State's growth
The Survey highlights that Tamil Nadu, despite accounting for just 4 per cent of India’s land area and 6 per cent of its population, contributed 9.4 per cent to the national GDP in 2024–25.
The state’s growth was led by the secondary sector, particularly manufacturing, which expanded by 14.74 per cent in 2024–25—more than three times the all-India average of 4.5 per cent.
Over the four-year period from 2021–22 to 2024–25, Tamil Nadu recorded the highest average manufacturing growth in the country at 9.38 per cent.
The services sector, which contributes 53.6 per cent to the state’s Gross State Value Added (GSVA), also registered double-digit real growth of 11.3 per cent in 2024–25. Real estate, public administration, transport, hotels and restaurants were among the sub-sectors showing robust expansion.
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The primary sector accounted for 13.4 per cent of GSVA, while the secondary sector contributed 33.1 per cent.
Export performance, FDI
Tamil Nadu’s export performance nearly doubled over four years, rising from $26.15 billion in 2020–21 to $52.07 billion in 2024–25. The state consistently ranks first in exports of electronics, textiles and leather products and second in engineering exports. Recognised as the ‘Detroit of India’, Tamil Nadu is a major hub for the automobile industry.
It also defied the national trend of declining foreign direct investment inflows, attracting $3,681 million in 2024–25, up from $2,169 million in 2022–23.
Per capita income
Per capita income reached ₹3.62 lakh in 2024–25, about 1.77 times the national average of ₹2.05 lakh, making Tamil Nadu the third-largest state in terms of per capita income. District-level data show that 32 out of 38 districts recorded per capita incomes higher than the all-India average.
Inflation, agriculture
On the inflation front, retail inflation in Tamil Nadu declined from 5.4 per cent in 2023–24 to 4.6 per cent in 2024–25, and further to 2.3 per cent in 2025–26 (up to December).
Food inflation moderated sharply to near zero in 2025–26. The state government attributed this to effective supply management and welfare measures, including the Public Distribution System and income-support schemes.
Agriculture remains significant, contributing ₹1.9 lakh crore and 6.6 per cent to GSVA. The state ranked first in ragi and sugarcane yields and second in oilseeds in 2024–25. Agricultural credit disbursal more than doubled between 2019–20 and 2023–24, reaching ₹4.52 lakh crore.
TN's development model
The Survey underscores Tamil Nadu’s distinctive development model that combines industrial growth with strong social sector investment.
Social sector expenditure rose from ₹1.13 lakh crore in 2021–22 to ₹1.57 lakh crore in 2025–26 (Revised Estimates). The state leads the country in higher education Gross Enrolment Ratio at 47 per cent, far above the national average of 28.4 per cent, and has one of the lowest multidimensional poverty rates at 1.43 per cent.
Employment generation remains central to economic growth and social stability. Tamil Nadu’s labour force participation rate increased from 71.5 per cent in 2021–22 to 72.1 per cent in 2023– 24, while India’s LFPR rose from 66.2 per cent to 71.3 per cent over the same period. The State’s unemployment rate declined from 5.1 per cent to 3.5 per cent, compared to a decline from 4 per cent to 3.2 per cent at the national level.
Higher enrolment in higher education and skill development, along with a strong social security system, likely contributed to these outcomes, said the survey.
Social sector
Looking ahead, Tamil Nadu aims to become a $1 trillion economy by 2030.
The Survey concludes that sustaining high growth with social justice, fiscal prudence and climate resilience will be critical to achieving developed-income status in the coming decade.