New Delhi: The government is targeting Fiscal deficit Three government officials said a less ambitious target of 6.3% to 6.5% of gross domestic product (GDP) for the next fiscal year, a less ambitious target than previously planned, as the Covid-19 transition threatens the economic recovery.
Finance Minister Nirmala Sitharaman is due to unveil the 2022-2023 budget on February 1 and officials said the thinking was that sharp cuts in government spending could hurt growth prospects.
The case load of coronavirus infections in India is rising, driven by the Omron version and concerns that consumer and business spending will be hit, leaving the government with no option but to step in.
Officials involved in the discussion said the plan now aims to cut fiscal deficit by 30-50 basis points for the next financial year. He declined to be named as he was not authorized to speak to the media.
Policymakers were hoping to bring down the fiscal deficit by a wide margin after reducing the deficit by 240 basis points to 6.8% in the current fiscal ending March.
Some private economists and brokerages said the fiscal deficit could be brought down to around 5% of GDP in 2020-21 from 9.4% in 2020-21 after the pandemic stimulus and increased revenue receipts.
Rising coronavirus cases have forced several states to impose restrictions, raising concerns among policymakers that falling consumer sentiment could hit the pace of economic recovery and all budget calculations.
Officials said Asia’s third-largest economy may miss the 10% growth target for the current 2021-22 financial year as the new Omicron version disrupts economic activity during January-March and dampens sentiment in the next financial year as well. Can do.
And, the economic growth target for the next fiscal year starting April will not exceed 7%, two officials said.
Presenting her third annual budget in Parliament, the finance minister is set to reveal new targets for government spending, tax receipts and economic growth.
“(Budget) discussions are on,” said one of the officials, adding, “The government aims to reduce the deficit and increase capital expenditure while keeping revenue expenditure flat.
A finance ministry spokesperson declined to comment for the story.
India’s economy has been recovering since restrictions on mobility were lifted in June, but economists fear new restrictions could drag growth in the coming months. The economy had contracted by 7.3% in the last fiscal.
no signs of economic slowdown and higher fiscal deficit targetEconomists said there may be a delay in the normalization of the accommodative stance of the Reserve Bank of India’s monetary policy committee, which will meet from February 7-9 after the presentation of the budget.
“We may miss the disinvestment (privatization) target by a large margin,” said one of the officials, adding that the sale of companies like BPCL, banks and insurance companies will be postponed to the next financial year.
The government has so far raised Rs 9,330 crore ($1.3 billion), a fraction of the target of Rs 1.75 lakh crore in receipts from privatization in the current fiscal, while higher tax collections have helped narrow the fiscal deficit.
Finance Minister Nirmala Sitharaman is due to unveil the 2022-2023 budget on February 1 and officials said the thinking was that sharp cuts in government spending could hurt growth prospects.
The case load of coronavirus infections in India is rising, driven by the Omron version and concerns that consumer and business spending will be hit, leaving the government with no option but to step in.
Officials involved in the discussion said the plan now aims to cut fiscal deficit by 30-50 basis points for the next financial year. He declined to be named as he was not authorized to speak to the media.
Policymakers were hoping to bring down the fiscal deficit by a wide margin after reducing the deficit by 240 basis points to 6.8% in the current fiscal ending March.
Some private economists and brokerages said the fiscal deficit could be brought down to around 5% of GDP in 2020-21 from 9.4% in 2020-21 after the pandemic stimulus and increased revenue receipts.
Rising coronavirus cases have forced several states to impose restrictions, raising concerns among policymakers that falling consumer sentiment could hit the pace of economic recovery and all budget calculations.
Officials said Asia’s third-largest economy may miss the 10% growth target for the current 2021-22 financial year as the new Omicron version disrupts economic activity during January-March and dampens sentiment in the next financial year as well. Can do.
And, the economic growth target for the next fiscal year starting April will not exceed 7%, two officials said.
Presenting her third annual budget in Parliament, the finance minister is set to reveal new targets for government spending, tax receipts and economic growth.
“(Budget) discussions are on,” said one of the officials, adding, “The government aims to reduce the deficit and increase capital expenditure while keeping revenue expenditure flat.
A finance ministry spokesperson declined to comment for the story.
India’s economy has been recovering since restrictions on mobility were lifted in June, but economists fear new restrictions could drag growth in the coming months. The economy had contracted by 7.3% in the last fiscal.
no signs of economic slowdown and higher fiscal deficit targetEconomists said there may be a delay in the normalization of the accommodative stance of the Reserve Bank of India’s monetary policy committee, which will meet from February 7-9 after the presentation of the budget.
“We may miss the disinvestment (privatization) target by a large margin,” said one of the officials, adding that the sale of companies like BPCL, banks and insurance companies will be postponed to the next financial year.
The government has so far raised Rs 9,330 crore ($1.3 billion), a fraction of the target of Rs 1.75 lakh crore in receipts from privatization in the current fiscal, while higher tax collections have helped narrow the fiscal deficit.
,