Union finance minister Arun Jaitley has a tough task ahead as the fiscal deficit in the first two months of this fiscal has already touched a whopping Rs 2.4 lakh crore constituting as much as 45.6 per cent of the estimate provided by his predecessor P. Chidambaram for the entire 12- month period.
The deficit during the same period last year was 33.3 per cent of Budget estimates.
The fiscal deficit, the gap between expenditure and revenue, for the whole fiscal pegged at Rs 5.28 lakh crore in the Interim Budget presented by Chidambaram in February is turning out to be unrealistic.
Jaitley will now have to do a delicate balancing act of limiting the fiscal deficit and at the same time ensuring that sufficient funds are allocated for social welfare schemes and big- ticket infrastructure projects in the highways and ports and power sectors.
The fiscal deficit was Rs 5,08,149 crore, or 4.5 per cent of GDP, in 2013- 14 down from 4.9 per cent in the previous year. Chidambaram had drawn flak for drastically slashing expenditure on productive schemes that impacted the economic growth rate. He had also passed on a neat chunk of the subsidy bill on petroleum and fertilisers to the next Budget as part of the exercise to show a lower budget deficit. Chidambaram in his Interim Budget speech had set the fiscal deficit target for 2014- 15 at 4.1 per cent of the GDP. Jaitley is scheduled to present his maiden Budget on July 10 in which he is expected to spell out the fiscal policies. The data released by the Controller and Accounts General on Monday further revealed that the total expenditure of the government during April and May was Rs 2.8 lakh crore.
Of the total expenditure, plan spending was Rs 59,609 crore and under non- plan head it was Rs 2,20,730 crore.
Revenue collection was Rs 38,505 crore.
Total receipts ( from revenue and non- debt capital) of the government during the two months was Rs 39,502 crore.
Courtesy: Mail Today