India’s Centre has reported a fiscal deficit of 52.5% of the Budget Estimate (BE) for the period from April to November 2024. This indicates that the government’s expenditure is running higher than its revenues, with fiscal deficit representing the gap between the two. The fiscal deficit target for the fiscal year is pegged at ₹17.89 lakh crore, and the figure reported for this period suggests that the government may need to take corrective actions to meet its full-year target.
Source:- bbc news
The government’s capital expenditure (capex) for the same period stands at 46.2% of the annual target. This is a positive indicator, as the Centre has maintained a strong commitment to infrastructure spending, which is a key component of its efforts to stimulate economic growth. The capex target for the year is ₹10.42 lakh crore, aimed at boosting economic recovery and long-term growth prospects. The robust pace of capital expenditure has been focused on key sectors like infrastructure, roads, railways, and defense, with the aim of increasing employment and supporting demand in the economy.
Source :- India Today
While the fiscal deficit and capex figures reflect the government’s proactive fiscal stance, the challenge remains in managing revenue growth, particularly in the context of subdued global growth and inflationary pressures. Higher spending on social welfare and subsidies has also added to the fiscal burden.
In summary, while the government has shown progress in capital expenditure, its fiscal deficit is an area of concern. Meeting the budgeted targets will require careful management of both expenditure and revenue collections, especially in the second half of the fiscal year.
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