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Economy News Details

Fiscal deficit at 7.3% of GDP in first six months

BS Reporter/Dilasha Seth/New Delhi 30 Nov 12 | 03:14 PM

The Centre's fiscal deficit stood at Rs 3.68 lakh crore in the first seven months of this fiscal, constituting 68.32% of revised target of fiscal deficit for the entire 2012-13. Finance Minister P Chidambaram had earlier revised fiscal deficit target to 5.3% of GDP from the Budget Estimate of 5.1%.

Collating GDP figures released today and fiscal deficit figures released last month, fiscal deficit constituted 7.36% of GDP in the first half of 2012-13.

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Fiscal deficit stood at Rs 3.67 lakh crore till October, against the revised estimate which comes at Rs 5.38 lakh crore, assuming nominal GDP growth of 14% as assumed in the Budget for 2012-13.

However, Chidambaram had said that the government will reassess the fiscal deficit target after mid-year review depending on pace of expenditure and resource position of the government.

If Budget Estimate is taken into account, fiscal deficit till October constituted 71.6% of the target. It had stood at 74.4% of the Budget Estimate for 2011-12 in the corresponding period of last fiscal. However, it should be noted that fiscal deficit touched 5.76% of GDP last fiscal against Budget Estimate of 4.6%.

Revenue deficit, a gap between the Centre's current expenditure over current receipts, stood at Rs 2,852,52 crore, which accounted for 81.4% of Budget Estimate against 79.1% in the corresponding period of last fiscal.

The government was able to control its expenditure, both plan and non-plan. The government’s plan expenditure stood at Rs 2.24 lakh crore, 43.2% of the budgeted Rs 5.21 lakh crore. Last year, plan expenditure had touched 45.6% of the Budget Estimate (BE) till October.

Non-plan expenditure stood at Rs 5.45 lakh crore till the seventh month of the fiscal, 57.2% of the Budget target of Rs 9.69 lakh crore for the entire fiscal. It stood at 58.7% of BE till October last fiscal.

Chidambaram today said that government has imposed measures like rationalisation of expenditure and optimisation of available resources such as-- 10% mandatory cut on non-plan expenditure in the current year, ban on holding of meetings and conferences at five-star hotels, ban creation of plan and non-plan posts and restrictions on foreign travel. He also said the government also endeavors to restrict the expenditure on central subsidies.

Though expenditure seemed well in control, government's revenue collection was slow, as its total revenue collections were just Rs 4.04 lakh crore, 43.2% of the BE of Rs 9.35 lakh crore. In the last fiscal, government had achieved 45.5% of the revenue target by October.

According to the data, the tax collections at the end of October, 2012 stood at Rs 3.33 lakh crore, constituting 43.3% of BE, against 43.9% in the corresponding period of last fiscal.

GDP expanded just 5.4% in the first half of this fiscal.

Coming to disinvestment, the government has so far raised Rs 932 crore through stake sale in NBCC and Hindustan Copper (HCL). It divested 10% in NBCC and 5.58% in HCL, and realised Rs 124.97 crore and Rs 807 crore, respectively. However, it targets to do Rs 30,000 crore worth of disinvestment.

The 2G spectrum auction could raise just Rs 9,407 crore out of the budgeted Rs 40,000 crore.

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