Govt confident of adhering to 5.9% fiscal deficit target: Finance Secretary

For the 2023-24 fiscal, the government has budgeted the fiscal deficit to be Rs 17.86 lakh crore or 5.9 per cent of the GDP

   
finance secretary on fiscal deficit

The government is confident of adhering to the 5.9 per cent fiscal deficit target budgeted for the current fiscal and the extension of free ration scheme will not impact the fiscal consolidation path, Finance Secretary T V Somanathan said on Thursday. “I am confident, as of today, we will adhere to our fiscal targets. Announcement on the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) does not by itself mean anything for our fiscal consolidation path. We are still committed to that path. That decision does not draw us off that path,” Somanathan told reporters.

The Union Cabinet, earlier this week extended the PMGKAY scheme to provide 5 kilograms of free foodgrains per month to 81.35 crore poor people for another five years that would cost the exchequer about Rs 11.80 lakh crore.

The scheme was to end this December.

It was introduced in 2020 as a pandemic relief measure, under which 5 kilograms of free foodgrains per beneficiary per month was provided in addition to the 5 kilograms of subsidised foodgrains under the National Food Security Act (NFSA).

As per the data released by the Controller General of Accounts on Thursday, fiscal deficit, or the gap in government revenue and expenditure, in the April-October period stood at Rs 8.03 lakh crore or 45 per cent of the full year budget estimate.

For the 2023-24 fiscal, the government has budgeted the fiscal deficit to be Rs 17.86 lakh crore or 5.9 per cent of the GDP.

Chief Economic Advisor V Anantha Nageswaran said “fiscal management remains on track” as is evident from the fiscal deficit numbers in the first seven months of the fiscal.

The April-October fiscal deficit was 45.6 per cent of the full year BE in the last fiscal. In the preceding five years, the deficit at the end of October used to average around 81.6 per cent of the budget estimate, he said.

As per the fiscal consolidation roadmap, the government aims to reduce fiscal deficit to below 4.5 per cent by 2025-26 from 6.4 per cent of GDP in 2022-23.

Leave a Reply

Your email address will not be published. Required fields are marked *