Tamil Nadu is one of the top three Indian states with heavy losses in State Public Sector Enterprises (SPSEs) for the year 2022-23. As per the 16th Finance Commission report, Uttar Pradesh faced the highest loss of ₹32,430 crore, followed by Rajasthan with ₹18,814 crore, and Tamil Nadu at ₹16,048 crore. These states belong to the non-north-eastern and hilly group. Most losses came from the power sector. The now-defunct Tamil Nadu Generation and Distribution Corporation (Tangedco) alone lost about ₹9,192 crore in that year. However, for 2024-25, the Tamil Nadu Power Distribution Corporation Limited (TNPDCL), one of Tangedco’s successors, reported a profit after tax of ₹2,073 crore. This profit came largely due to state government support, which included a tariff subsidy of ₹15,772 crore and takeover of losses amounting to ₹16,107 crore. The accumulated deficit also decreased to ₹1,19,153 crore in 2024-25 from ₹1,66,944 crore in 2023-24, helped by Tangedco’s unbundling. The Finance Commission called the poor financial health of SPSEs “a burden on State budgets,” noting that governments spend large amounts on subsidies, grants, equity, loans, and loan guarantees for these enterprises. In 2022-23, Tamil Nadu’s budget outlay for SPSEs was ₹26,867 crore, with outstanding loan guarantees of ₹89,768 crore at the year-end. Despite these losses, Tamil Nadu was not included among states having a high proportion of loss-making SPSEs. This distinction brings some relief to policymakers and citizens. The report was published on February 8, 2026.