The fiscal deficit is expected to reduce to 3.5 per cent in FY20 after the telcos may the AGR dues, an SBI research report said.
The fiscal deficit is expected to reduce to 3.5 per cent in FY20 after the telcos may the AGR dues, an SBI research report said. The deficit is likely to come down to 3.5 per cent from 3.8 per cent of the GDP in FY20 after AGR dues payment of Rs 1.20 lakh crore, SBI said in its ECOWRAP. The Supreme Court last week slammed the telcos and the government for delaying the payment as directed by it. “The fiscal arithmetic will change significantly post March 16, 2020, (the date till which telecom companies have to pay their AGR dues). If we assume that the government is able to collect Rs 1.20 lakh crore through AGR dues, the fiscal deficit for FY20 will reduce to 3.5 per cent of GDP,” the report said.
The government expects the fiscal deficit to stand at 3.8 per cent in FY20 according to its revised budget estimates. “However, this will put a question on the amount that the Government can raise next year from the telecom sector out of Rs 1.33 lakh crore budgeted, which in turn can impair the fiscal arithmetic of FY21 ”, the report added.
In a separate development, Oil Minister Dharmendra Pradhan today said that he thinks that the non-telecom public sector units (PSUs) are not covered by the order by the Supreme Court that asked the holders of the telecom license to pay statutory dues after including non-telecom revenues. RBI Governor Shaktikanta Das also said Monday that the central bank is closely monitoring the impact of the crisis on lenders by way of a default by the telcos, if any.