Budget 2024: Fiscal deficit target for FY25 cut to 4.9% of GDP; govt to beat FY26 goal, too

The government has cut its fiscal deficit target for FY25 to 4.9% of gross domestic product (GDP) from the interim budget goal of 5.1% and aims to beat its FY26 target of containing the fiscal gap at 4.5%, finance minister Nirmala Sitharaman said on Tuesday.

Presenting the full Budget for FY25, Sitharaman said the overall expenditure in FY25 is now estimated at Rs 48.21 lakh crore, against the interim Budget goal of Rs 47.68 lakh crore. Capital spending outlay for this fiscal is retained at the interim Budget level of Rs 11.11 lakh crore.



ET had first reported on June 3 that the new government may cut the fiscal deficit target for FY25 when it presents the full budget in July, encouraged by a better-than-expected deficit reading for FY24 and the generous dividend payout from the central bank.


In the interim budget in February, the government had set the FY25 fiscal deficit goal at 5.1% of gross domestic product and revised the FY24 target to 5.8% from the previously budgeted 5.9%. It ended up improving on the revised estimate for FY24, containing the fiscal gap at 5.6%.