Farm schemes to push state fiscal deficits to 3.2% of GDP in FY'20: Ind-Ra

With competitive populism taking the centre stage in the run-up to the upcoming general elections, the combined deficit of all states are likely to rise to 3.2 per cent of GDP in 2019-20, up from the budgeted target of 2.6 per cent in 2018-19, says India Ratings and Research (Ind-Ra). 

In the current financial year, states are expected to witness a fiscal slippage of 0.2 percentage points to 2.8 per cent of GDP in 2018-19, the rating agency noted in its FY20 outlook. 

Over the past few years, several states have announced farm loan waivers to assuage the growing distress in rural areas.