India’s fiscal deficit for the first four months of this fiscal year through July stood at 6.06 lakh crore rupees, or 33.9% of annual estimates, government data showed today.
The fiscal deficit widened from 20.5% reported in the comparable year-earlier period.
The wider fiscal deficit comes amid mushrooming speculations that the Narendra Modi-led government, which is seeking to return to power for the third term after Lok Sabha elections next year, will soon have to unleash various fiscal measures and particularly so as to rein in galloping inflation rate.
While the fiscal impact after the Indian government this week slashed LPG cylinder prices by Rs 200 per unit is seen to be limited as the move for now seems to only trim oil refiners’ profit margins, the rising clamor for the need to cut petrol and diesel prices may have an impact on budget gap. However, the robust surplus transfer of Rs 87,416 crore to New Delhi’s coffer by Reserve Bank of India has provided a big cushion and lifted non-tax revenues.
Total receipts stood at 7.75 lakh crore rupees, while overall expenditure in April to July was at 13.81 lakh crore rupees. They were 28.5% and 30.7% of this fiscal year’s budget target.
Revenue receipts stood at 7.61 lakh crore rupees, of which tax revenue was 5.83 lakh crore rupees and non-tax revenue was 1.79 lakh crore rupees.
Tax and non-tax revenues were 25% and 59.3% of the budgeted estimate. While tax revenue was narrower than 34.4% of budget estimate in the last fiscal year, non-tax revenue swelled from 33.2% of budget forecast in the same period last year.
Revenue deficit was at 3.02 lakh crore rupees or 34.7% of the fiscal year’s budget target, data showed. This was wider than last year’s 16.4% of budget estimate.
While announcing the federal budget for this fiscal year, Finance Minister Nirmala Sitharaman said India aims to narrow the fiscal gap to 5.9% of gross domestic product from 6.4% in the last financial year.
On the expenditure side, New Delhi spent about 1.41 trillion rupees on major subsidies such as food, fertilisers and petroleum. This was 38% of the revised annual aim, tad wider than 35% of budgeted expenditure in the comparable period last year.
