Fiscal correction: Focus should be on reducing the fiscal deficit

The govt would do well to be cautious and resist the temptation of increasing expenditure in the run-up to the Lok Sabha elections because the economy is likely to slow in the second half of the year

The Union government may not be able to meet the revenue collection targets for excise and Customs duties this fiscal year. As reported by this newspaper, the shortfall under these heads could be to the tune of Rs 1 trillion, largely because of duty cuts on petroleum products and edible oil. The government may also witness a shortfall in non-tax receipts because of lower dividend by the Reserve Bank of India and sustained lacklustre performance on the disinvestment front. The government, however, is confident of meeting the fiscal deficit target for the year despite significantly higher than budgeted expenditure on