India’s fiscal deficit at 31.7% of FY12 target

India’s fiscal deficit in the April to May period touched 31.7% of its target for the financial year 2011-12, data released by the Government showed. The budget gap stood at Rs. 130,726 crores at the end of May compared to the annual forecast of Rs. 412,817 crores, the Controller General of Accounts (CGA) said. Fiscal deficit at the end of April was Rs. 74,661 crores, or 18.1% of the FY12 projection. In April-May 2010, the fiscal deficit was Rs 1,00,907 crores or 26.5% of the Budget Estimate for that year. Revenue deficit for the first two months of FY12 was at Rs. 110,069 crores, or 35.8% of the annual projection for FY12. Revenue deficit was 29.4% in the year-ago period.

Revenue receipts in April-May were Rs 28,716 crores or 3.6% of the annual target of Rs 7,89,892 crores. Net tax revenue was Rs 23,103 crores in April-May or 3.5% of FY12 estimate of Rs 6,64,457 crores. Non-tax revenue in the first two months comprised 4.5% of the FY12 target of Rs 1,25,435 crores. The total expenditure was Rs 1,66,262 crores or 13.2% of the BE of Rs 1,257,729 crores.



In February 2011, the Government forecast a fiscal deficit of Rs 4.13 trillion, or 4.6% of GDP, for the current financial year. That is lower than the 4.7% in FY11. However, economists are worried about the Government finances in the face of some moderation in the economy, reduction in duties on crude & petroleum products, uncertainty over the disinvestment proceeds and possible increase in spending.