The fiscal deficit of the central government in the first four months of the current financial year has been 17.2 percent of the target for the entire financial year. This information was given in the government data released on Friday. According to the data released by the Controller General of Accounts (CGA), the overall fiscal deficit stood at Rs 2,76,945 crore till the end of July. In the same period of the last financial year (2023-24), the deficit was 33.9 percent of the budget estimate (BE). In the Union Budget, the government has set a target of bringing the fiscal deficit to 4.9 percent of the gross domestic product (GDP) in the current financial year 2024-25.

Last year the deficit was 5.6% of GDP

The fiscal deficit was 5.6 per cent of GDP in FY 2023-24. Overall, the government aims to limit the fiscal deficit to Rs 16,13,312 crore during the current financial year. Revealing the central government's income-expenditure data for the first four months of the current financial year, the CGA said the net tax revenue for the current financial year was Rs 7.15 lakh crore or 27.7 per cent of the budget estimate. Net tax revenue collection by the end of July, 2023 was 25 per cent of the estimate.

Total expenditure was 27 percent of the budget estimate

The total expenditure of the central government in the four months till July was Rs 13 lakh crore or 27 per cent of the budget estimate. In the same period a year ago, this expenditure was 30.7 per cent of the budget estimate. Of the total expenditure, Rs 10,39,091 crore was on the revenue account and Rs 2,61,260 crore on the capital account. Of the total revenue expenditure, Rs 3,27,887 crore was for interest payment and Rs 1,25,639 crore for major subsidies. The CGA said that till July, Rs 3,66,630 crore has been transferred by the Center to the state governments as a share of taxes, which is Rs 57,109 crore more than last year.

What is fiscal deficit

Fiscal deficit is the difference between the total expenditure and revenue of the government. It is an indication of the total borrowing required by the government. Aditi Nayar, chief economist at rating agency ICRA, said the Centre's fiscal deficit more than halved to Rs 2.8 lakh crore in the April-July period of the current fiscal year from Rs 6.1 lakh crore in the same period a year ago. This was due to a reduction in capital expenditure during the election months and substantial dividends received from the Reserve Bank of India. She said the revenue receipts scenario appears to be quite favourable, while capital expenditure and disinvestment targets are unlikely to be achieved.