FM STICKS TO FISCAL ROAD MAP TARGETS DEFICIT OF 5.9% IN FY24

Union Finance Minister Nirmala Sitharaman on Wednesday said in her Budget speech the Central government was expected to achieve its fiscal deficit target of 6.4 per cent this fiscal year FY23), and is targeting a fiscal deficit of 5.9 per cent for FY24.

“In my Budget Speech for 2021-22, I had announced we plan to continue the path of fiscal consolidation, reaching a fiscal deficit below 4.5 per cent by 2025-26 with a fairly steady decline over the period. We have adhered to this path, and I reiterate my intention to bring the fiscal deficit below 4.5 per cent of GDP by 2025-26,” she said.

The fiscal deficit is the difference between the government’s expenditure and revenues when the former is higher.

“To finance the fiscal deficit in 2023-24, net market borrowings from dated securities are estimated at 211.8 trillion. The balance financing is expected to come from small savings and other sources. Gross market borrowings are estimated at 15.4 trillion,” Sitharaman said.

Union Finance Secretary T V Somanathan said at the post-Budget press conference the Centre would not deviate from its borrowing target numbers, and any alteration in the fiscal deficit would be funded through other means, including the National Small Savings Fund, apart from the borrowing programme.

This is the third year in a row when the Centre is not amending the Fiscal Responsibility and Budget Management Act, which governs budget making and deficit targets.