India’s April-December 2018 fiscal deficit

Context

  • India’s budgetary fiscal deficit for the April-December period stood at Rs 7.01 lakh crore or 112.4 per cent of the budgeted target of Rs 6.24 lakh crore.

Key Facts

  • Fiscal deficit is the gap between income and expenditure of the government. Initially, the government pegged the deficit at 3.3 per cent of the GDP for the current fiscal. This has been revised to 3.4 per cent of GDP in the Interim Budget presented on February 1.
  • Controller-General of Account on Monday, showed that fiscal deficit for the first nine months is more than 7.01 lakh crore as against the Budget Estimate of 6.24 lakh crore.
  • This is 112.4 per cent of the Budget Estimate while similar number for the corresponding period of 2017-18 was 113.6 per cent.
  • The real problem is being seen on account of tax, where the government has managed to mobilise little over 63 per cent of the Budget Estimate. One of the reasons here is lower-than-expected GST collections.
  • The government had earlier budgeted to cut the fiscal deficit to 3.3 per cent of GDP or Rs 6.24 lakh crore in 2018-19, from 3.53 per cent in the previous financial year.
  • The interim budget for 2019-20 revised the fiscal deficit upwards marginally to 3.4 per cent of GDP or over Rs 6.34 lakh crore, on account of the additional outlay of Rs 20,000 crore for funding income scheme for small farmers.
  • The revenue receipts of the government totalled Rs 10.84 lakh crore or 62.8 per cent of BE in 2018-19 till December, compared with 66.9 per cent during the same period last year.
  • The revenue receipts stood at 66.9 per cent during the same period last year.
  • The earlier estimate to mobilise Rs 17.25 lakh crore revenue during the current fiscal has been revised upwards to over Rs 17.29 lakh crore in the 2019-20 interim budget.
  • Tax revenue was 63.2 per cent of budget estimates compared with 73.4 per cent in the comparable period of the previous year.
  • The total expenditure of the government at December-end was Rs 18.32 lakh crore or 75 per cent of budget estimates.
  • The increase in the fiscal deficit has been attributed to lower revenue collections.
  • On the other hand, expenditure appears to be on track with 75 per cent in three quarters. Here the capital expenditure is over 70 per cent while revenue expenditure is over 75 per cent of the Budget Estimate.
  • Experts feel that the government might roll over some of the expenditure to stick to the fiscal consolidation path.

Related posts

Total
0