The Centre’s fiscal deficit – difference between income and expenditure – was 17.2 per cent during April-July period of Fiscal Year 2024-25. It was around 34 per cent during the corresponding period of the last fiscal.
Deficit came down mainly on account of general elections and record dividend from the Reserve Bank of India. Also, tax collection, especially GST, has been buoyant. The government has estimated fiscal deficit at 4.9 per cent of GDP for current fiscal as against 5.6 per cent of FY24.
Data released by Controller General of Accounts (CGA) showed that the government received over ₹10.23 lakh crore (31.9 per cent of the corresponding BE 2024-25 of Total Receipts) during April-July under tax, non-tax and non-debt capital receipts head. At the same time, total expenditure incurred was over ₹13 lakh crore (27 per cent of corresponding BE 2024-25). Data also showed that during April-July period, the net tax revenues rose by 23 per cent, non-tax revenues expanded by 55 per cent boosted by the RBI dividend, while there was contraction in both revenue expenditure (2.3 per cent) and capex (15.4 per cent).
CGA said over ₹3.66 lakh crore has been transferred to State governments as devolution of share of taxes by the Centre up to July, which is ₹57,109 crore higher than the previous year.
Capex doubled
According to Aditi Nayar, Chief Economist with ICRA, with the completion of the Parliamentary elections, Centre’s capex doubled to over ₹80,000 crore in July this year from around ₹38,600 crore in July last year, and even exceeded the average of ₹60,000 crore seen in Q1 FY2025.
“To meet the FY25 BE, ₹8.5 lakh crore of capex needs to be incurred in the last eight months of the year, an expansion of 34.6 per cent relative to the same period of FY2024 (₹6.3 lakh crore), which appears quite challenging, even though we expect a pickup after the presentation of the Budget and the withdrawal on the monsoon,” she said.