Budget 2017 may be flexible on fiscal deficit target

FY18 figure likely to be closer to 3.5% to make room for more govt spending

When Finance Minister (FM) Arun Jaitley presents the 2017-18 Budget on February 1, he may announce a fiscal deficit target close to 3.5 per cent of gross domestic product (GDP). 

A government official said this would enable a higher spend on infrastructure, housing, the social sector and other flagship schemes of Prime Minister Narendra Modi’s government.

According to the existing fiscal responsibility and budget management (FRBM) road map, the fiscal deficit target for the next year should be three per cent of GDP. The current financial year’s target of 3.5 per cent is, however, likely to be met, due to