What sets Tamil Nadu apart financially despite weak political leadership

Markets also endorse long term financial management by the state

Tamil Nadu hasn’t really had a political government for close to a year. Yet on August 8, when the Reserve Bank of India (RBI) sold debt papers of 15 state governments, Tamil Nadu got the market’s version of an ovation. The state’s papers were priced better than all, except Maharashtra and Goa, at 7.21.

At the same auction, Uttar Pradesh, despite having a government with a strong majority, got priced much worse than Tamil Nadu, at 7.23.

It is the equivalent of the Indian government’s crib against the ways of the international debt markets, where its papers are rated mere investment grade