Union Budget 2023-24 Expectations - GoI Likely To Peg Fiscal Deficit At 5.8% Of GDP In FY24: ICRA

The FY2024 Union Budget needs to balance supporting growth in economic activity and fiscal consolidation.

<div class="paragraphs"><p>Finance Minister Nirmala Sitharaman. (Photo: Naveen Sharma/Reuters)</p></div>
Finance Minister Nirmala Sitharaman. (Photo: Naveen Sharma/Reuters)

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ICRA Research Report

In the backdrop of a global growth slowdown and geopolitical uncertainty, the FY2024 Union Budget needs to balance supporting growth in economic activity and fiscal consolidation.

We foresee the Government of India’s fiscal deficit at 5.8% of gross domestic product in the FY24 budget, lower than 6.4% of GDP expected in FY23.

The Budget math and the extent of the fiscal consolidation would depend on factors such as the market-driven level of fertiliser subsidy, savings from discontinuation of the erstwhile Pradhan Mantri Garib Kalyan Ann Yojana and the level of budgeted capex as well as disinvestment receipts.

Moreover, the upcoming Budget should provide a clear fiscal glide path for the medium term to underscore the GoI’s commitment to reduce its fiscal deficit over the next two-three years.

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ICRA Budget Expectations_2023-24.pdf


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