India's April-May fiscal deficit at ₹1.62 lakh crore, widens on-year to 9.6% of FY27 aim

India's fiscal deficit for the first two months of FY27 through May stood at ₹1.62 lakh crore, or 9.6% of the full-year budget estimate, government data showed today.

The fiscal deficit widened sharply from 0.8% of the annual target reported in the comparable year-earlier period.

Total receipts stood at ₹7.19 lakh crore, while overall expenditure in April-May was at ₹8.81 lakh crore. They were 19.7% and 16.5% of this fiscal year's budget target, respectively.


In the year-earlier period, total receipts and expenditure stood at 21% and 14.7% of the budget estimates.

Revenue receipts stood at ₹6.99 lakh crore, of which tax revenue was ₹3.48 lakh crore and non-tax revenue was ₹3.51 lakh crore.



Tax and non-tax revenues were 12.1% and 52.7% of the budgeted estimate, respectively. While tax revenue was slightly narrower than 12.4% of the budget estimate in the same period last year, non-tax revenue also moderated from 61.2% of the annual target achieved a year earlier.

The robust non-tax revenue collections were supported by the Reserve Bank of India's record dividend transfer to the government, announced in May, which helped bolster the Centre's finances in the early part of the fiscal year.

Revenue deficit stood at a surplus of ₹68,985 crore, or -11.6% of the fiscal year's budget target, compared with a surplus equivalent to -34.9% of the annual estimate in the comparable period last year, data showed.

While presenting the Union Budget for FY27, Finance Minister Nirmala Sitharaman pegged the fiscal deficit target at 4.4% of GDP, maintaining the government's fiscal consolidation path and its commitment to keeping the budget gap under control.

The government has budgeted for total expenditure of ₹53.47 lakh crore in FY27, including a capital expenditure outlay of ₹12.22 lakh crore aimed at supporting economic growth and infrastructure creation.

On the expenditure side, New Delhi spent about ₹75,542 crore on major subsidies such as food, fertilisers and petroleum during April-May. This amounted to 18% of the full-year budget estimate, higher than 13% of the budgeted expenditure incurred in the comparable period last year.

Capital expenditure stood at ₹2.51 lakh crore, or 20.5% of the annual target, slightly higher than 19.7% achieved in the corresponding period of the previous fiscal year.