The central government's fiscal deficit exceeded the budgeted target of Rs 5.31 lakh crore by December end despite policymakers...
The central government’s fiscal deficit exceeded the budgeted target of Rs 5.31 lakh crore by December end despite policymakers’ assertion that the gap between receipts and spending would be limited at 4.1% of GDP this fiscal. Finance minister Arun Jaitley has pinned hopes on better tax revenue receipts in the final three months of the fiscal along with funds from disinvestment and spectrum sales to achieve that challenging goal.
The government may also resort to some more spending cuts in the last quarter.
As per data released by the Controller General of Accounts on Friday, the fiscal deficit during April-December was Rs 5.32 lakh crore or 100.2% of the 2014-15 estimate, mainly because of subdued revenue realisation. The fiscal deficit during the same period last year was at 95.2% of that year’s target.
The government’s sale of 10% stake in Coal India fetched about Rs 22,500 crore. More disinvestment in blue chip state-run firms are in the offing. It hopes to raise Rs 43,425 crore this fiscal by way of share sales in PSUs and another Rs 20,000 crore from other sources including spectrum sales.
Jaitley had said earlier this weak that even though revenue receipt has been challenging due to slow manufacturing industry, now it is turning around and it looks like the Centre would be able to meet the fiscal targets. Recent data showed the manufacturing sector rebounded with a 3.8% growth in November, recovering from its sharpest decline in five-and-a-half years recorded at 7.4% in October 2014. While direct tax collection grew at 12.9% in the April December period, indirect tax receipts growth is far behind the 20% growth target set for the current year.