India’s April-February 2024 Fiscal Deficit Hits 86.5% of Full-FY24 Target: Official Data

India’s fiscal deficit during April-February 2024 stood at Rs 15 lakh crore, hitting 86.5 per cent of the revised full FY24 target, according to official data released on Thursday.

The fiscal deficit during the corresponding period last year had stood at 82.8 per cent of revised estimates (RE) of the Union Budget 2022-23.

Fiscal deficit, which is the difference between the total expenditure and revenue of the government, is an indication of the total borrowings that are needed by the government.

For 2023-24, the government’s fiscal deficit is estimated at Rs 17.35 lakh crore or 5.8 per cent of the GDP. The government’s total receipts stood at Rs 22.45 lakh crore (81.5 per cent of corresponding RE 2023-24 of total receipts) as of February 2024, according to the data released by the Controller General of Accounts (CGA).

The total expenditure incurred by the Centre was Rs 37.47 lakh crore (83.4 per cent of corresponding RE 2023-24).

Aditi Nayar, chief economist and head (research & outreach) at ICRA, said, “The surge in the GoI’s fiscal deficit in February 2024 (Rs 4 lakh crore Vs Rs 2.6 lakh crore in February 2023) can be partly attributed to the higher tax devolution released during that month (Rs 2.1 lakh crore vs Rs 1.4 lakh crore in February 2023), which led to a decline in the revenue receipts and net tax revenues in that month.”

The GoI’s gross tax revenues need to record an 8% growth in the last month of FY2024 to meet the RE for the year, which seems achievable, she said.

“The GoI has released Rs 10.3 lakh crore as tax devolution to the states in FY2024 by end-Feb 2024, leaving Rs 0.7 billion for disbursal to the states to meet the target tax devolution of Rs 11 lakh crore indicated in the FY2024 RE by the GoI, half as much as the release in March 2023,” Nayar said.