SA budget to include tram line funding

The South Australian government will spend $50 million to extend Adelaide's inner-city tram line along North Terrace.

The funds will be included in Thursday's state budget with the new line servicing Adelaide's arts and cultural precinct, universities and the future development on the old Royal Adelaide Hospital site.

Treasurer Tom Koutsantonis says the new line demonstrates the state government's commitment to invest in public transport and key infrastructure projects.

"The tram extension along North Terrace is also an investment in South Australian jobs. We will ensure as many local jobs and contractors as possible are utilised during the project," he said.

Premier Jay Weatherill said the tram line extension would help make Adelaide a more attractive city.

"Modern regions compete on the attractiveness of their capital cities," Mr Weatherill said.

"The world is beginning to understand that we have an incredibly beautiful and increasingly vibrant capital city."

Work on the new line will begin at the end of this year and should be complete in the first half of 2018.