• Source:JND
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Fiscal Deficit:  According to official data released on Wednesday, the Centre's fiscal deficit reached 29.4% of the full-year target at the end of the first half of FY25.
In absolute terms, the fiscal deficit, which is the gap between the government's expenditure and revenue, stood at Rs 4.74,520 crore at the end of September, according to data released by the Controller General of Accounts (CGA).

During the corresponding period of 2023-24, the fiscal deficit was 39.3% of the Budget Estimate (BE). The government had projected in the Union Budget to reduce the fiscal deficit to 4.9% of the gross domestic product (GDP) in the current fiscal year 2024-25. In 2023-24, the GDP deficit was 5.6%.

In nominal terms, the government aims to keep the fiscal deficit at Rs 16,13,312 crore in the current fiscal year. According to the Union government's revenue and expenditure data for the first half of 2024-25, the net tax revenue for the current fiscal year stood at Rs 12.65 lakh crore, or 49% of the BE.

Net tax revenue collection stood at 49.8% at the end of September 2023. The total expenditure of the central government stood at Rs 21.11 lakh crore or 43.8% of the BE through September. The BE accounted for 47.1% of the expenditure in the year-ago period. Of the total expenditure, Rs 16.96 lakh crore was in the revenue account and Rs 4.15 lakh crore in the capital account.

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Commenting on the CGA data, Aditi Nayar, Chief Economist at ICRA, said the central fiscal deficit narrowed from Rs 7 lakh crore in the April-September period to Rs 4.7 lakh crore in H1 FY25, indicating continued shrinkage over the years.

Fiscal deficit is the difference between total government expenditure and revenue. It indicates the total debt required by the government.

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