Food and Consumer Ministries along with Rural Development Ministries have exhausted their budget allocation for full fiscal in seven months only.
Meanwhile, fiscal deficit for April-October period has touched nearly 120 per cent of budget estimate (BE) as against 102.4 per cent during corresponding period of last fiscal. Fiscal deficit is difference between expenditure and income.
According to data made public by Controller General of Accounts (CGA), book keeper of Central government, fiscal deficit for April-October period touched ₹9.53 lakh crore as against ₹7.96 lakh crore. This was on account of much less revenue than higher expenditure. Total earning during the period touched 31.5 per cent of BE as against 44.9 per cent of last fiscal.
Tax collection especially from direct tax is down. Though collection from GST has improved in September and October, but it is not enough to fill the gap which is why net tax collection reached 35.2 per cent of BE. At the same, lesser than expected disinvestment affected non tax review which was less than one third of BE as against more than two-third during corresponding period of last fiscal.
Deficit was more driven by less revenue than higher expenditure. Data shows total expenditure was 54.6 per cent of BE as against 59.4 per cent during corresponding period of last fiscal.
Commenting on latest number, Aditi Nayar, Principal Economist with ICRA, said overall expenditure at ₹30.2-lakh crore during current fiscal mildly lower than the budgeted level, despite the fiscal support measures that have been announced so far. This translates into a projected expenditure (excluding recovery of loans) of ₹13.7 lakh crore in November-March FY2021, which is a considerable 33.6 per cent higher than the outgo in the last five months of FY2020, and therefore may prove to be challenging to achieve despite the recent relaxation for Q3 FY2021.
”We expect the Centre’s fiscal deficit to widen to ₹14.5-lakh crore or 7.7 per cent of GDP (assuming contraction of 7.5 per cent in the nominal GDP) in FY2021 from the budgeted level of ₹8-lakh crore, and ₹9.4-lakh crore in FY2020 (Prov.). With healthy inflows into small savings in the last few months, we do not foresee a further expansion in the Centre’s dated borrowing programme for current fiscal,” she said.