Tamil Nadu Interim Budget 2026-27 Sets Rs.1,943 Crore for Handlooms and Textiles

The Government of Tamil Nadu has introduced several policy measures aimed at improving the global competitiveness of the state’s textile industry, which represents nearly one-third of India’s total textile business. The sector is expected to contribute significantly to the state’s target of achieving a USD 1 Trillion economy by 2031.

On 29 January 2026, the Hon’ble Deputy Chief Minister of Tamil Nadu, Udhayanidhi Stalin, released the Tamil Nadu Integrated Textile Policy 2025-26 at the inaugural session of the International Textile Summit 360, a two-day event organised by the Government in Coimbatore.

The Interim Budget presented by the Hon’ble Minister of Finance, Thangam Thennarasu, has allocated Rs.1,943 Crore exclusively for handlooms and textiles. In addition, a similar allocation has been made for MSMEs, while Rs.4,282 Crore has been set aside for industries, which is also expected to benefit the textile sector.

In a press release issued today, Mr. Durai Palanisamy, Chairman of The Southern India Mills Association (SIMA), welcomed the Interim Budget and thanked the Hon’ble Chief Minister, M. K. Stalin, for extending support toward the implementation of measures outlined in the Integrated Textile Policy, including initiatives related to modernisation, infrastructure development and employment generation.

Mr. Durai also welcomed the allocation of Rs.6 Crore for establishing an Advanced Quality Testing Laboratory at The South India Textile Research Association (SITRA), Coimbatore, to support athleisure and technical textiles manufacturing in the state. He stated that funds have been provided for the development of Handloom Parks, modernisation of powerlooms, installation of shuttleless looms, and attracting new investments in processing, technical textiles and garmenting.

He further welcomed the proposal to introduce a ‘New Integrated Renewable Energy Policy’ aimed at increasing renewable energy capacity in the state, with a budget allocation of Rs.18,091 Crores.