FY15 fiscal deficit target of 4.1% GDP likely to be met: Citi

India's fiscal deficit overshot budget estimate of Rs 5.31 lakh cr by Dec-end

The government is likely to meet its fiscal deficit target of 4.1 per cent of gross domestic product (GDP) for the current financial year, says global brokerage firm Citigroup.

The fiscal deficit target of 4.1 per cent of GDP for 2014-15 is likely to be met though the fiscal trends are “weak”, it said.

According to the data released by Controller General of Accounts (CGA), India’s fiscal deficit overshot the Budget estimate of Rs 5.31 lakh-crore by December-end.

However, a “compression” in plan expenditure coupled with a pick-up in divestments, would likely help the government meet its 2014-15 fiscal deficit of 4.1 per cent of GDP, it said.

“We believe the fiscal deficit road map of 4.1 per cent, 3.6 per cent and 3 per cent of GDP in FY15-FY17 will be adhered to thanks to imminent revenue and expenditure reforms, lower crude oil prices and an uptick in growth,” Citigroup India economist Rohini Malkani said in a research note.

The fiscal deficit during April-December period was Rs 5.32 lakh-crore or 100.2 per cent of the 2014-15 estimate, mainly because of subdued revenue realisation.

The fiscal deficit — the gap between government expenditure and revenue — during the corresponding period last year was at 95.2 per cent of that year’s target.