NEW DELHI: Data released on Friday by the Controller General of Accounts (CGA) showed that, as of the end of January 2021, India’s fiscal deficit had breached 66.8 per cent of the revised budget estimates for the current financial year (2020-21).
The gap between the government’s revenue and expenditure (Fiscal deficit), in absolute terms, stood at Rs 12.34 lakh crore. The whole year’s target, which has been more than doubled by the finance minister to factor in the impact of the pandemic, has been pegged at Rs 18.48 lakh crore, or 9.5 per cent of estimated GDP. Before the Centre had revised the estimates during the recent Budget session of the Parliament, the revenue disruptions caused by Covid had caused to Centre to breach the earlier target of Rs 7.96 lakh crore as early as July 2020.
According to the data released on Friday, during the April 2020 to January 2021 period, total receipts stood at Rs 12.83 lakh crore which is 80.1 per cent of the revised Budget target of Rs 16.01 lakh crore. Tax revenue stood at Rs 11.01 lakh crore against Budget estimates of Rs 13.44 lakh crore, while non-tax revenue was at Rs 1.41 lakh crore, 67 per cent of revised estimates of Rs 2.10 lakh crore.
Revenue expenditure stood at Rs 21.55 lakh crore, while capital expenditure came in at Rs 3.62 lakh crore for the period. Total expenditure was Rs 25.17 lakh crore 73 per cent of the Rs 34.50 lakh crore revised estimate. Revenue deficit was 62.6 per cent of revised estimates at Rs 14.56 lakh crore, and primary deficit at Rs 7.14 lakh crore.
Experts warn that India’s fiscal prospects are likely to remain weak. “Our current expectation is that in the current fiscal ending March 2021, the economy would contract 7 per cent... We expect a rebound of 13.7 per cent growth in the next fiscal on normalisation of activity and base effects,” Moody’s Investors Service Associate Managing Director (Sovereign Risk) Gene Fang said. Prospects for fiscal consolidation also remain weak given the government’s mixed track record of implementing revenue-raising measures, Fang pointed out.
Rs 12.34L cr India’s fiscal deficit as of the end of Janaury 2021, according to CGA
Rs 18.48L cr India’s estimated fiscal deficit for the entire fiscal year 2020-21