Fiscal deficit narrows to 91.3% of government’s target for current financial year
The situation has improved marginally since August, when the deficit had reached 96.2% of the target, data by Controller General of Accounts showed.
India’s fiscal deficit – a measure of how much the government’s expenditure exceeds its revenue – at the end of the first half of the current financial year was 91.3% of the budget estimate, PTI reported.
The deficit was Rs 4.99 lakh crore in April-September, compared to the target of Rs 5.47 lakh crore for the 2017-’18 financial year, according to data released by the Controller General of Accounts. The situation has marginally improved since August, when the deficit reached 96.2% of the target.
During the same period in the last financial year, the deficit was at 83.9% of the target. The government wants to bring the figure down to 3.2% of the gross domestic product. Last week, Economic Affairs Secretary SC Garg said that the government was committed to sticking to the target but will carry out a review in December. The Centre had met the 3.5% target the last financial year.
According to the data released by the Controller General of Accounts, the government earned Rs 6.23 lakh crore in the first six months but spent Rs 11.49 lakh crore by end-September.
Last week, the Finance Minister Arun Jaitley announced a Rs 2.11 lakh crore recapitalisation plan for state-owned banks, which will enable them to lend freely again. However, it will not increase the fiscal deficit much as bulk of that capital will be raised by issuing bonds, economists and policymakers told BloombergQuint. The rest of the money will come from market borrowings and budgetary support.