New Delhi: In signs of fiscal stress, the government crossed nearly two-thirds of the deficit target for the current financial year in the first four months.
The fiscal deficit, which is the difference between government receipts and spending, touched Rs 3.4 lakh crore in April-July, or 62.8 percent of the budget estimate.
The fiscal deficit had reached 51.51 percent of the budget estimate in the April-July period of 2012-13, government data showed today.
The deficit so far is without accounting for a substantial portion of food and oil subsidies, which are likely to exceed budget estimates following the enactment of the Food Security Law and an oil import bill that's shooting up because of an over 20 percent rupee depreciation.
While the government has provided for Rs 90,000 crore as food subsidy in the Budget, the actual outgo may be close to Rs 1.13 lakh crore. Similarly, the subsidy on diesel and cooking fuel may be double the provision of Rs 20,000 crore.
Net tax receipts for the first four months of the fiscal year touched Rs 1.45 lakh crore, while total expenditure was Rs 5.21 lakh crore.
The fiscal deficit during 2012-13 came down to 4.9 percent of GDP from 5.8 percent a year earlier. In the current financial year, the government plans to lower the deficit to 4.8 percent of GDP.
"The government will do whatever is necessary to contain the fiscal deficit to 4.8 percent of GDP this year. The most growth-friendly way to contain the deficit is to spend carefully, especially on subsidies that do not reach the poor, and we will take effective steps to that end," Prime Minister Manmohan Singh said in Parliament today while making a statement on the state of the Indian economy.
Earlier, Finance Minister P Chidambaram had said that red lines have been drawn for the fiscal deficit and they will not be breached.
The revenue deficit during April-July went up to Rs 2.77 lakh crore, or 73 percent of the budget estimate, compared with 61.3 percent last year.
Revenue collection slowed down to 16.7 percent of the budget estimate (Rs 1.76 lakh crore) as against 18 percent in the previous fiscal.
Total receipts worked out to 16.1 percent of the estimate in the first four months, compared with 17.7 percent in 2012-13.
Total expenditure was higher at 31.3 percent of the estimate, compared with 29.3 percent.
First Published: Friday, August 30, 2013, 16:12