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India's Fiscal Deficit at 63% of FY26 Target, Capex Surges

India's fiscal deficit for the first ten months of FY 2025-26 stands at Rs 9.8 lakh crore, representing 63% of the full-year target. Net tax receipts and non-tax revenue have shown significant growth compared to the previous year. The government's capital expenditure has increased to Rs 8.4 lakh crore, highlighting a focus on infrastructure investment. Finance Minister Nirmala Sitharaman has reaffirmed the commitment to fiscal consolidation, targeting a further reduction in the deficit.

Key Points: India's Fiscal Deficit at 63% of FY26 Target

  • Fiscal deficit at 63% of FY26 target
  • Net tax receipts rise to Rs 20.94 lakh crore
  • Capital expenditure surges to Rs 8.4 lakh crore
  • Debt-to-GDP ratio declines to 56.1%
2 min read

India's fiscal deficit in April-January at 63 pc of 12-month target for FY26

India's fiscal deficit for April-January FY26 is Rs 9.8 lakh crore, 63% of the annual target, with capital expenditure rising to Rs 8.4 lakh crore.

"The target reflects a balance between supporting economic momentum and keeping public finances stable. - Nirmala Sitharaman"

New Delhi, Feb 27

India's fiscal deficit for the first 10 months of FY 2025-26 was Rs 9.8 lakh crore, which works out to 63 per cent of the estimate for the full financial year ending on March 31, official figures released on Friday showed.

Net tax receipts for April-January stood at Rs 20.94 lakh crore, up from Rs 19 lakh crore collected in the same period last year.

Non-tax revenue went up to Rs 5.57 lakh crore, from Rs 4.7 lakh crore in the same period of the previous year.

Total government expenditure was at Rs 36.9 lakh crore compared with Rs 35.7 lakh crore in the year ago period.

There was also an improvement in the quality of government spending as capital expenditure, which entails investments in infrastructure projects such as highways, ports and railways, shot up to Rs 8.4 lakh crore compared with Rs 7.6 lakh crore during the same period of the previous year. The rise in capex reflects the government's continued focus on these big-ticket projects to boost growth and create more jobs in the economy.

The fiscal deficit represents the gap between the government's total expenditure and its total revenue. The data confirms that the country is on course to meet its fiscal deficit target of 4.4 per cent for 2025-26.

Finance Minister Nirmala Sitharaman has projected a further reduction in the fiscal deficit to 4.3 per cent of GDP for 2026-27 as the government continues on the path of fiscal consolidation to ensure economic growth with stability.

The Finance Minister said that the government had fulfilled its commitment to reduce the fiscal deficit to 4.4 per cent in the Budget for 2025-26 and would now reduce it further to 4.3 per cent as it continues on the fiscal prudence path.

She said that the target reflects a balance between supporting economic momentum and keeping public finances stable.

The Finance Minister also said that India's debt:GDP ratio has come down to 56.1 per cent in 2025-26 and would be further reduced in the Budget for 2026-27 to 55.6 per cent.

The decline in the debt:GDP ratio will reduce the Government's outgo on interest payments, which will help to keep a lower fiscal deficit and free up resources for development, she said.

- IANS

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Reader Comments

S
Sarah B
As someone who follows global economics, it's impressive to see India consistently reducing its fiscal deficit and debt-to-GDP ratio. Many developed nations are struggling with much higher numbers. The path to 4.3% seems achievable with this momentum.
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Priyanka N
The numbers look good on paper, but I hope this fiscal prudence doesn't come at the cost of social sector spending. What about healthcare and education budgets? Infrastructure is important, but so is human development. A balanced approach is needed.
A
Aman W
Net tax receipts up by nearly Rs 2 lakh crore! That's a solid increase. It shows economic activity is picking up. If the capex focus continues, we should see even better revenue numbers next year. The cycle is working.
K
Karthik V
Reducing the debt burden is crucial. Lower interest payments mean more money for actual development projects. This is a technically sound approach for long-term stability. Hope they stick to the targets.
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Michael C
The 63% figure for 10 months seems reasonable, but the last quarter spending is always high. The real test will be the final number in March. The government has a good track record lately, so cautiously optimistic.

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