In June, India’s federal fiscal deficit reached ₹1,357.12 billion, a significant increase from the previous month’s deficit of ₹506.15 billion.
During the April-June quarter, the government reported net tax receipts totaling ₹5,496.33 billion. Meanwhile, the fiscal deficit for the same period was recorded at ₹1,357.12 billion.
Data released on July 31 shows that the Centre’s fiscal deficit narrowed to 8.1% of the full-year estimate in the first quarter of the year, compared to 25.3% for the same period last year.
The fiscal deficit had reduced to 3 percent in the previous fiscal year, largely due to a higher-than-expected RBI dividend of Rs 2.11 lakh crore.
Revenue receipts increased by 27.6 percent, up from 22.4 percent in Q1FY24, with tax revenues rising at a faster rate.
Capital expenditure (Capex) utilization was lower at 16.3 percent, compared to 27.8 percent in Q1FY25 the previous year.
In the Budget announced on July 23, the government reduced the fiscal deficit target to 4.9 percent of GDP from the 5.1 percent target set in the interim Budget.
The Finance Minister stated in her Budget speech that the government aims to reduce the fiscal deficit further to 4.5 percent or lower by FY26.
The revenue receipt target was increased to Rs 31.3 lakh crore for FY25, up from Rs 30 lakh crore in the interim budget, while Capex spending remained unchanged at Rs 11.11 lakh crore.
India’s Federal Fiscal Deficit Soars in June
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