April-May Fiscal Deficit Down as Non-Tax Revenue Grows

Fiscal deficit at 0.8% is at the lowest level since the Centre began publishing data in Apr 1997

- Rhik Kundu

India's fiscal deficit staged a marked improvement in the first two months of 2025-26, helped by strong growth in non-tax revenue even as the government's capital expenditure spending increased.

The Union government reported fiscal deficit of ₹13,163 crore for April-May, amounting to 0.8% of the target for the whole of 2025-26, according to data released Monday by the Controller General of Accounts. For the same period last year, fiscal deficit was ₹50,615 crore.

India's cumulative fiscal deficit at 0.8% of the full-year target is the lowest level since the Centre began publishing monthly fiscal data in April 1997.

The government has maintained a strong commitment to fiscal consolidation, with the deficit for FY26 projected at ₹15.69 trillion, lower than the ₹16.85 trillion reported in FY25, and pegged at 4.4% of GDP.

Finance minister Nirmala Sitharaman reiterated this target in her budget speech earlier this year, affirming the Centre's glide path to reduce fiscal deficit to 4.4% of GDP by 2025-26.