India's April-November fiscal deficit over 46% of FY22 target

India's April-November budgetary fiscal deficit has reached 46.2 per cent of the FY22 target.

As per the data furnished by the Controller General of Accounts (CGA), the fiscal deficit -- the difference between revenue and expenditure -- for the April-November 2021-22 period stood at Rs 695,614 crore, or 46.2 per cent of the budget estimates (BE).

The FY22 deficit has been pegged at Rs 15.06 lakh crore.

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Besides, the CGA data showed that the fiscal deficit during the corresponding months of the previous fiscal was 135.1 per cent of that year's target.

The Central government's total expenditure stood at Rs 2,074,607 crore (62.7 per cent of BE) while total receipts were Rs 1,378,993 crore (69.8 per cent of BE).

ICRA's Chief Economist Aditi Nayar said: "The GoI's fiscal deficit compressed to just under Rs 7 lakh crorein April-November 2021 from Rs 10.8 lakh crore in April-November 2020, with incremental revenues continuing to sharply outpace expenditure.

"Although the fiscal deficit upto November 2021 stood at only 46 per cent of the budget estimate (BE) for the full year, the fading hopes of the disinvestment target being met, portend a deficit of Rs 16.5-17 trillion in FY2022, overshooting the budgeted target."

Nayar also said that while gross tax revenues displayed a robust growth of 18 per cent in the month of November 2021, the higher release of central tax devolution to the states curtailed the net tax revenues, and thereby enlarged the fiscal deficit for that month.

India Ratings & Research's Chief Economist Devendra Kumar Pant said: "Despite excise duty cuts on petrol and diesel in November 2021, gross tax revenue grew 18.2 per cent YoY."

"In FY22 (April-November) gross tax revenue grew 50.3 per cent. Tax collection growth will slow down in the rest of FY22 due to high positive growth from October 2020 and despite high inflation moderation in nominal GDP growth."