India’s fiscal deficit widens to Rs 11.91 lakh crore in 10 months of FY23

India’s fiscal deficit widened to Rs 11.91 lakh crore in the first 10 months of 2022-23, which is 67.8% of the revised annual target, as per the government data released on Tuesday.

In absolute as well as percentage terms the fiscal deficit in the first 10 months of the current financial year is higher when compared with the previous year. In April-January period of 2021-22, the fiscal deficit stood at Rs 9.38 lakh crore, which was 58.9% of that year’s revised budgetary estimate.

For the full year 2022-23, the government has pegged the fiscal deficit at Rs 17.55 lakh crore, or 6.4% of the GDP. In the union budget presented on 1st February, the total fiscal deficit target for the financial year 2022-23 was revised upward from the original budgetary target of Rs 16.61 lakh crore.

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As per the data released by the Controller General of Accounts, the total central government expenditure in April-January period of the current financial year stood at Rs 31.67 lakh crore, which is 75.7% of the full year target of Rs 41.87 lakh crore.

Total receipts in the first 10 months of the current financial year stood at Rs 19.76 lakh crore, which is 81.3% of the full year target of Rs 24.31 lakh crore.

Fiscal deficit is calculated by deducting total receipts from total expenditure. The government borrows from the market to finance its fiscal deficit.

In the union budget 2023-24, Finance Minister Nirmala Sitharaman has set a target to bring down the fiscal deficit to Rs 5.9% of GDP in the financial year beginning April 1, 2023 and further down to 4.5% of the GDP by 2025-26 from 6.4% for the current fiscal.

Revenue deficit, the gap between revenue expenditure and revenue receipts, widened to Rs 6.78 lakh crore in the first 10 months 2022-23, which is 61% of the full year target of Rs 11.11 lakh crore.

Primary deficit, which is calculated by deducting interest payments from fiscal deficit, stood at Rs 4.52 lakh crore in April-January period of the current financial year, which is 55.5% of the full year target of Rs 8.14 lakh crore.