Revenue deficit and total expenditure rise
Raising concerns over government finances, the government fiscal deficit touched 76% of the budget estimate (BE) in the H1 of 2013-14, which is marginally higher than 74.6% recorded by first five months of the FY14. The fiscal deficit increased to Rs 4,12,088 crore between April and September 2013.Moreover, the revenue deficit swelled an even higher 84.8% of the full fiscal target or to Rs 3,22,277 crore in the period. The tax revenue clocked 34.8% of BE in H1 FY14, significantly lower than the 38.1% of the BE last fiscal. Tax receipts for the first six months of the fiscal touched Rs 3,07,589 crore of the full year target of Rs 8,84,078 crore.
Meanwhile, the total expenditure increased to 48.6% of BE in the same period from 46.5% recorded in the corresponding period of the previous year.
The rising fiscal deficit may see the government cutting plan expenditure to meet the 4.8% target. The cut in plan expenditure may hit the already weakening economy. However, the good agriculture output and subsequent higher agricultural growth and lower trade deficit may provide cushion to lower growth.
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