In the current fiscal year, tax and non-tax revenue collections could take a hit. The projections will need to be recalibrated in light of the uncertain environment.
Both the government and the RBI are currently so focused on their respective targets that they are losing sight of the fact that some flexibility might actually be a good thing.
Instead, govt will use ratio of govt debt-to-GDP as anchor for fiscal policy, Somanathan said. Historically, India has targeted fiscal deficit of 3% of GDP but failed to achieve it.
Capital expenditure for next FY is achievable but could be challenging given this year's under-achievement. Moreover, rise of interest payments doesn't bode well for quality of expenditure.
While boosting capex & rural spending, govt has set fiscal deficit target of 5.1% of GDP, which means Centre will have to borrow less to finance deficit, allowing pvt sector to borrow more.
India's fiscal deficit in the first seven months of the FY ending in March 2024 was $96.86 billion, or 45% of the estimate for the whole year, according to official data.
Earlier in a statement, the rating agency said the narrower fiscal deficit underscores the Modi government's commitment to longer-term fiscal sustainability.
Govt had set ambitious target of Rs 1,75,000 crore in Union Budget, with over a third of receipts targeted from the listing of Life Insurance Corporation and privatisation of BPCL.
DEA secretary says govt will do all that’s necessary to meet expenditures related to health, to provide for the poor and for resurgence and recovery of industry.
The Economic Survey 2025-26 is not a celebration of success, but a measured warning that the traditional paradigms of global economic growth are no longer applicable.
The IT services sector contributed more than half of India’s Gross Value Added, serving as a major driver of exports and employment, the Economic Survey 2025-26 has found.
Shield AI will provide V-BAT vertical takeoff & landing drones along with licences for software, which will be integrated into aircraft and made available to select Indian partners.
No nation other than China can negotiate one-on-one with Trump on an equal footing. That’s why the middle powers who so far formed the core of multilateral bodies now feel orphaned.
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