Govt on track to meet fiscal deficit target

However, at Rs 3.96 lakh cr, revenue deficit till Feb exceeds RE for FY13

For the first 11 months of this financial year, the Centre’s fiscal deficit totalled 97.4 per cent of the revised estimate for 2012-13, even as tax revenues struggled to meet this target.

The Centre’s revenue deficit till then had exceeded the revised estimate, official data showed on Thursday.

The fiscal deficit for the April 2012-February 2013 period stood at Rs 5.07 lakh crore, compared with the revised estimate of Rs 5.21 lakh crore for the entire financial year, data released by the Controller General of Accounts showed.

The Centre’s revenue deficit stood at Rs 3.96 lakh crore till February, 101.2 per cent of the revised estimate of Rs 3.91 lakh crore for 2012-13. In March, the government has room to cut this deficit, as the last month of a financial year records heavy revenues.

“In March, the revenue deficit is likely to come down,” said Soumya Kanti Ghosh, senior fellow at the Indian Council for Research on International Economic Relations.

Till February, the fiscal deficit accounted for 5.05 per cent of India’s estimated gross domestic product (GDP) for this financial year (about Rs 100 lakh crore).

In the revised estimate for this financial year, the government had targeted the fiscal deficit at 5.2 per cent of GDP, against 5.1 per cent in the  Budget estimate and 5.3 per cent pegged by the finance ministry in its fiscal consolidation plans. “If everything is alright, at the end of this financial year, the fiscal deficit would be lower than 5.2 per cent of GDP,” Ghosh said.

In his post-Budget interactions, Finance Minister P Chidambaram had exuded confidence when the final figures were released, the fiscal deficit would be lower than 5.2 per cent of GDP. In 2011-12, the government’s fiscal deficit stood at 5.7 per cent of GDP.

For this financial year, the revised estimate of revenue deficit was 3.9 per cent of GDP, against 3.4 per cent in the Budget estimate. Till February, it stood at 3.95 per cent of the estimated GDP for 2012-13.

Till February, tax receipts (net to the Centre after cutting the share of states) stood at Rs 5.72 lakh crore, 77.1 per cent of the revised estimate of Rs 7.42 lakh crore for 2012-13. In the corresponding period of the previous financial year, tax receipts stood at 76.9 per cent of the revised estimate for that financial year.

At Rs 1.07 lakh crore, non-tax revenues stood at 82.4 per cent of the revised estimate for this financial year.

On the disinvestment front, only Rs 22,797 crore was mopped up, against the revised estimate of Rs 24,000 crore.

Plan expenditure, which bore the brunt of the government’s squeeze on expenditure this financial year, stood at Rs 3.53 lakh crore, 82 per cent of the revised estimate of Rs 4.29 lakh crore for 2012-13. Non-Plan expenditure was Rs 8.66 lakh crore, 86.5 per cent of the revised estimate.