NEW DELHI: Fiscal deficit — the difference between the government’s expenditure and revenue (excluding money from borrowings) — widened to Rs 6,12,105 crore during the April-November period, government data showed on Friday. It is 112 per cent of the budgeted target of Rs 5.46 lakh crore for the full financial year ending March 2018. It means that finance minister Arun Jaitley will have a tough time with his Budget, say experts.
The last time the deficit went out of control was during the global slowdown in 2008-09, when it touched 132 per cent during the eight-month period. According to data compiled by the Controller General of Accounts (CGA), fiscal deficit in the month of November was Rs 86,784 crore, compared to Rs 26,383 crore in October and Rs 34,489 crore in November 2016.
According to CGA data, total receipts — from revenue and non-debt capital — during the current fiscal’s first eight months were Rs 8.66 lakh crore, or 54.2 per cent of estimates for the year. The government has set a target of Rs 15,15,771 crore of revenue receipts for FY18. This means, it’s still a long way to go for the full-year target. Meanwhile, total expenditure has touched Rs 14,78,815 crore so far in FY18, with November alone clocking Rs 1,86,167 crore.
With barely three months left for the financial year to end, it’s doubtful if the government will be able to get its fiscal math right. For one, it has to find ways to generate more revenue while keeping expenditure down. With GST collections not picking up as expected, clocking higher revenue will be a challenge. On Wednesday, the Finance Ministry announced it would borrow Rs 50,000 crore more this fiscal, giving clear signals the government was ready to breach the fiscal deficit target of 3.2 per cent of GDP. According to the government’s quarterly review of trends in receipts and expenditure in relation to the Budget, it is monitoring the emerging economic situation and is taking measures for maintaining fiscal balance.
Fiscal Shock