Fiscal deficit scenario could change in TN: Fin Minister

Allaying apprehensions raised by opposition DMK over the state's fiscal deficit, Tamil Nadu Finance Minister O Panneerselvam today told the assembly that the fiscal deficit projection for 2017-18 at 3.34 per cent was based on present scenario which may change.
Referring to a DMK member's view that the state would violate the 3 per cent threshold for fiscal deficit next year, he said fiscal deficit would also increase when revenue deficit goes up. "However, it has been reined in within 3 per cent (in tune with FRBM Act)."
DMK's Palanivel Thiagarajan earlier said fiscal deficit projected for 2016-17 was 2.96 per cent of GSDP, against the three per cent target of FRBM Act, "but the projection for 2017-18 suggest, we will violate this target next year,"

The medium-term fiscal projection for 2017-18 has pegged fiscal deficit at 3.34 per cent.
Citing the 3.34 per cent projection, the Minister said, "The projection is based on present scenario and computed in keeping with FRBM Act. It cannot be said that the same scenario will prevail during next year. It may change and accordingly projections would change or decisions will be taken based on that situation."
Winding up discussion on the revised budget, he noted that fiscal deficit for 2017-18 has (also) been projected considering the payout possibilties arising out of the Seventh Pay Commission's recommendations.
Refuting views of E V Velu (DMK) that according to an RBI report, Tamil Nadu had the highest fiscal deficit, he said it was prepared before the revised estimates was made.

As per revised estimates, Maharashtra has a fiscal deficit of Rs 37,949 crore, more than that of Tamil Nadu.