Fiscal Deficit Update: Government Balances Books Amid Economic Challenges

India's central government's fiscal deficit reached 17.9% of the annual target by June's end, as reported by the Controller General of Accounts. Compared to last year's 8.4%, the gap between government expenditure and revenue was Rs 2.80 trillion for the first quarter of the 2025-26 fiscal year.

The central government's fiscal deficit has reached 17.9% of its full-year target by the end of June, according to the latest data from the Controller General of Accounts. This marks a significant increase from the 8.4% recorded in the first quarter of the prior fiscal year.

In absolute terms, the fiscal deficit, which represents the gap between the government's expenditure and revenue, stood at Rs 2,80,732 crore for the April-June period of the 2025-26 fiscal year. The government has projected a fiscal deficit of 4.4% of GDP, or Rs 15.69 lakh crore, for the entire year.

The CGA data revealed that the Centre's net tax revenue amounted to Rs 5.4 lakh crore, accounting for 19% of the corresponding Budget Estimates for 2025-26, as of June 2025. Meanwhile, total expenditure during the first quarter was Rs 12.22 lakh crore, or 24.1% of the BE, reflecting a rise from last year's 20.1% in the same period.

(With inputs from agencies.)