The fiscal deficit in April-October was Rs 751 crore, accounting for 46.5% of the Budget Estimate (BE). 804 crore (45.0% of BE) in the same period last fiscal year.
Government capital spending during the seven months was lower than expected, at just 42% as of October. Economists believe it will be a challenge for the government to spend the remaining 58% in the remaining five months. This is an important issue because capital spending is critical to long-term economic growth.
In FY24, the fiscal deficit was Rs 1,654 crore as against the budget target of Rs 1,786 crore, achieving 95.3% of the target. The central government’s fiscal deficit stood at 5.6% of GDP, lower than the revised estimate of 5.8%.
The latest official data shows that direct net tax collection has recorded strong growth so far this financial year, rising 16.45% from the same period last year to over 1,582 billion rupees.
Total direct tax collection before rebates increased by 20.32% annually to Rs 1,921 crore from Rs 1,596 crore in 2023-24. Refunds issued during the period were Rs 338 crore, a growth of 42.49%. All of this signals that the current state of government finances is significantly favorable. Total expenditure reached 4,443 billion rupees, achieving 99% of the target, of which capital expenditure on infrastructure projects was 9.49 billion rupees.