Budget 2018: Govt misses fiscal deficit target; seen at 3.5% in FY’18

Finance Minister Arun Jaitley on Thursday projected a higher fiscal deficit of 3.5 % of the GDP for 2017-18, as against the target of 3.2 %, on account of GST implementation and deferment of spectrum auction.

The fiscal deficit or gap between total expenditure and revenues has been pegged at 3.3 % as against FRBM mandate of 3%.

As per the revised estimates presented by Jaitley in the Union Budget 2018-19, the net borrowing for the current fiscal was raised steeply to Rs 4.79 lakh crore as against the estimate of Rs 3.5 lakh crore.

The government will borrow Rs 4.07 lakh crore from the market in 2018-19, around Rs 73,000 crore lower than the current fiscal.

Referring to public finances, Jaitley said that in 2017- 18, the central government will be “receiving GST revenues only for 11 months, instead of 12 months”.

“This will have fiscal effect,” he said.

There has also been some shortfall in non-tax revenues on account of certain developments, including deferment of spectrum auction, he added.

A part of this shortfall has been made up through higher direct tax revenues and bigger disinvestment receipts, Jaitley said.

“Revised fiscal deficit estimates for 2017-18 are Rs 5.95 …read more