India's April Fiscal Deficit Reaches 11.9% Of FY26 Target; FY25 Projection Met
The government expects the fiscal deficit at Rs 15.68 lakh crore during FY26 or 4.4% of the GDP.
The Union government's fiscal deficit reached 11.9% of the budgeted target by April for fiscal 2026, according to the Controller General of Accounts.
The fiscal deficit was Rs 1.86 lakh crore, as per data released on Friday. The government expects the fiscal deficit at Rs 15.68 lakh crore during FY26 or 4.4% of the GDP.
The revenue deficit was 9.4% of the fiscal target at Rs 49,000 crore. Revenue expenditure includes regular costs like salaries, pensions, interest payments, and subsidies.
In contrast, revenue receipts come from taxes, non-tax income, and grants. The revenue receipts in April stood at Rs 2.56 lakh crore or 7.5% of the budget estimate.
The total expenditure was Rs 4.65 lakh crore or 9.2% of the budget estimate.
A 65% year-on-year surge in government capex in April was well above the average monthly required rate, noted Aditi Nayar, chief economist at rating agency ICRA.
"However, this was offset by the modest contraction in revenue expenditure which contained the growth in total expenditure to near 10%. Given this and the 21% growth in revenue receipts, the fiscal deficit was limited and even lower than the Rs 2.1 lakh crore in the year-ago month," she said.
FY25 Deficit Target Met
Besides, the government met the fiscal deficit target of 4.8% for FY25. In the revised estimates presented to Parliament in February, the government had pegged the fiscal deficit or gap between expenditure and revenue at Rs 15,69,527 crore or 4.8% of GDP.
The data showed that the fiscal deficit in actual terms was Rs 15,77,270 crore, or 100.5%, of the revised estimate.
The government received Rs 30.78 lakh crore or 97.8% of the revised target of total receipts during 2024-25. This comprised Rs 24.99 lakh crore in tax revenue (net to Centre), Rs 5.37 lakh crore of non-tax revenue and Rs 41,818 crore of non-debt capital receipts.
On the other hand, the total expenditure incurred by the Centre was Rs 46.55 lakh crore (98.7% of corresponding RE 2024-25), out of which Rs 36.03 lakh crore is on the revenue account and Rs 10.52 lakh crore is on the capital account.
Nayar said that though the fiscal deficit marginally exceeded the revised estimate, it was led by a "welcome overshooting" in capex amid a less palatable miss on the receipts side being largely offset by considerable savings in revenue expenditure in the fiscal.
"The upward revision in the FY25 nominal GDP number also augurs well for meeting the deficit and debt to GDP targets for FY26," she said.
(With PTI inputs)
