Centre on track to meet fiscal deficit target of 5.8% for FY24

The Centre remains confident of meeting the revised targets for the current financial year that were set out in the Interim Budget 2023-24 and officials are optimistic of meeting the fiscal deficit target as well as keeping the pedal on capital expenditure.

The fiscal deficit target of 5.8% of the GDP for FY24 will be met,” said an official source.

The Interim Budget 2024-25, which was presented on February 1, had lowered the fiscal deficit target for FY24 from the Budget estimate of 5.9%.

Meanwhile, capital expenditure, which is pegged at Rs 9.5 lakh crore for FY24 in the Revised Estimates as against the Budget Estimate of Rs 10 lakh crore also remains on track. According to sources, about 80% of the capex target has been utilised by early February this year.

“Given the trend, there is an expectation that ministries will be able to utilise the full amount,” said the source.

Capex has in fact been slightly ahead of revenue expenditure, the source said, noting that revenue expenditure has been slightly lower at about 79% of the RE of Rs 35.4 lakh crore by early February 2024.

Between April and December 2023, the Centre’s capex amounted to Rs 6.73 lakh crore while the revenue expenditure stood at Rs 23.8 lakh crore.

Official data on Central government accounts up to January 31, 2024 will be released on February 29.

The Centre has been banking on sustained capital expenditure by government ministries and agencies as a means to boost economic growth post the Covid-19 pandemic that has led to a slowdown in private capital expenditure.