Fiscal gap at 8.1% of FY25 target

New Delhi: The Centre reported a comfortable fiscal position at the end of the first quarter, helped by the large dividend from the Reserve Bank of India (RBI) and muted expenditure during the general election.

The fiscal deficit at the end of June was ₹1.36 lakh crore, or 8.1% of the target for the year, according to data released by the Controller General of Accounts (CGA).

Comparatively, in FY24, at the end of June, the fiscal deficit was ₹4.5 lakh crore, 25.3% of the budget estimate. The government has budgeted a fiscal deficit of ₹16.9 lakh crore, or 4.9% of the gross domestic product (GDP).


Fiscal deficit is the excess of expenditure over revenues that is met through borrowings.

The net tax revenue was ₹5.5 lakh crore in the first quarter, or 21.1% of the budget estimate for the current fiscal.

The net tax revenue collection was 18.6% of the budget at the end of June in FY24. The Centre's total expenditure in the first quarter was ₹9.7 lakh, or 20.4% of the budget estimate compared with 23% a year ago, indicating the slow pace of spending in the election quarter.

The total expenditure in the quarter comprised ₹7.88 lakh crore on the revenue account and the balance ₹1.81 lakh crore towards the capital account.

"The GoI's capex was tepid at ₹374 billion in June 2024, as compared to ₹1.1 trillion in June 2023," said Aditi Nayar, chief economist, ICRA.

"To meet the FY2025 BE, ₹9.3 trillion of capex needs to be incurred in the last three quarters of the year, a growth of 39% relative to the same period of FY2024 (₹6.7 trillion), which appears quite challenging."

In May this year, the RBI transferred ₹2.1 lakh crore dividend to the government.