CII urges govt to stick to fiscal deficit target

Industry body CII has suggested the government to stick to the fiscal deficit target of 4.9 per cent of GDP for FY25 and 4.5 per cent for FY26, cautioning that "overly aggressive targets" beyond these could adversely affect India's economic growth.

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"India has been growing rapidly amidst a slowing global economy. Prudent fiscal management for macroeconomic stability has been pivotal to this growth," said Chandrajit Banerjee, Director General, CII, elaborating on suggestions for the forthcoming Union Budget.

CII also highlighted the announcement in the Union Budget FY25 to keep the fiscal deficit at levels that help reduce the debt-to-GDP ratio. In preparation for this, the forthcoming budget could lay out a glide path to bring the centre's debt to below 50 per cent of GDP in the medium term (by FY31), and below 40 per cent of GDP in the long term, CII has suggested.