Prime Minister Narendra Modi's government has already used up nearly all of its budget for the current fiscal year and tax revenues are expected to fall far short of initial expectations. At the same time economic growth has slowed, sparking calls for more stimulus.
Calling for more focus on debt-to-GDP ratio, its recommendation for the fiscal deficit for the current fiscal is lower than 3.2 per cent that Finance Minister Arun Jaitley has set for himself in the Budget for 2017-18.
Uttar Pradesh Chief Minister Yogi Adityanath will chair the new governments first cabinet meeting on Tuesday amid heightened expectations that a farm loan waiver scheme will be approved, signalling the governments intent to walk the talk on a key poll promise.
Foreign brokerage HSBC today said despite financial support from the Centre, Indian state governments' fiscal deficit widened more than budgeted and the gap will remain at the elevated level in 2017-18.
The fiscal deficit is a measure of the governments annual borrowing. The government borrows because its expenses, like those of a household, often exceed income. It raises loans from the market; issues treasury bills and borrows from small savers.
Finance Minister Arun Jaitley presented the economic survey, authored by the chief economic adviser, on Tuesday January 31, 2017. It is an official report on the economy and sets the tone for the Union Budget.
Financial year and assessment year. Financial year (FY) runs from April 1 to March 31 of the next year; assessment year (AY) is the year following the FY. Tax on income earned in an FY is paid during the AY.
It all begins with the finance ministers speech in the Lok Sabha. The Budget is then tabled in parliament. Discussions on the economy and broad Budget measures take place without voting. The parliament then breaks for a three-week recess. Parliamentary Standing Committees give reports on ministries estimates or demands for grants.
The exercise to make the Budget is a long-drawn one. It juggles political pressures, economys priorities and utmost secrecy. Budget work begins in August with a circular to ministries and departments. They reply with details of funds they need.
The fiscal deficit for April top January period came at 5.64 lakh crore as against Rs 5.32 lakh crore year-on-year (YoY). The fiscal deficit for the period is 105.7 percent of the FY17 Budget estimate.
The best thing Mr. Jaitley has done is he has not tinkered too much, especially with indirect taxes and has gone with the flow which have made the markets buoyant. Overall, the economy is going in the right direction with a fiscal deficit of 3.2%.
The customary post-Budget address of the Finance Minister before the boards of the two regulators comes against the backdrop of the government pegging fiscal deficit at 3.2 percent of GDP for the financial year ending March 2018.
Government projects fiscal deficit target of 3.2%, in line with market consensus. FY18 Revenue deficit pegged at 1.9%, below FRBM mandated level of 2.0%. Focus of the Budget on Investment and Consumption revival
GDP for Budget Estimate (BE) 2017-2018 has been projected at Rs 1,68,47,455 cr assuming 11.75% growth over the Revised Estimates (RE) of 2016-2017 (Rs 1,50,75,429 crore). Fiscal deficit for 2017-18 is targeted at 3.2% of GDP and the government remains committed to achieve 3% in the following year