The fiscal deficit, the gap between government's expenditure and revenue, in actual terms was Rs 5.08 lakh crore as against 5.24 lakh crore projected in the revised estimate.
"The fiscal deficit is 4.5% of GDP. Revenue deficit is 3.2% of GDP. Effective revenue deficit is 2% of GDP," the Controller General of Accounts (CGA) said in the provisional accounts for 2013-2014.
The government's total expenditure worked out to be Rs 15.63 lakh crore in the last fiscal as against the original budget estimate Rs 16.65 lakh crore. The expenditure estimate was later revised downwards to Rs 15.90 lakh crore in the interim budget.
The revenue collection was Rs 10.15 lakh crore. The revised target was Rs 10.29 lakh crore.
The government had chalked out a fiscal consolidation road map under which the fiscal deficit needs to be brought down 3% of GDP by 2016-17.
The lower fiscal deficit reduces the government's expenditure on interest payment and unlock funds for investments in social welfare programmes as well as infrastructure development.