India’s Fiscal Deficit Hits ₹7.1 Lakh Crore In April-August, Reaches Nearly 42% Of FY27 Target

New Delhi: India’s fiscal deficit widened to Rs 7.1 lakh crore during the April-August period of FY27, reaching 41.9 percent of the government’s full-year Budget target, according to data released by the Controller General of Accounts (CGA) on Wednesday.

The Centre has budgeted a fiscal deficit of Rs 16.96 lakh crore for FY27, equivalent to 4.3 percent of the country’s gross domestic product (GDP).

August Deficit Jumps

The fiscal gap widened sharply during August. The deficit for the month stood at around Rs 2.5 lakh crore, nearly double the Rs 1.29 lakh crore recorded in August last year.

The latest numbers indicate that the government has already used more than two-fifths of its full-year fiscal deficit target in the first five months of FY27.

Spending Rises

Government expenditure during April-August increased to Rs 20.78 lakh crore from Rs 18.80 lakh crore in the corresponding period of the previous financial year.

Capital expenditure, which includes government spending on infrastructure and asset creation, climbed to Rs 5.10 lakh crore from Rs 4.31 lakh crore a year earlier.

Meanwhile, total government receipts stood at Rs 13.67 lakh crore during the five-month period, higher than Rs 12.82 lakh crore recorded a year ago.

What Happened In Q1?

During April-June FY27, the fiscal deficit stood at Rs 3.08 lakh crore, equivalent to 18.2 percent of the full-year Budget Estimate. It was 17.9 percent during the corresponding period last year.

The Centre’s finances received support from stronger tax collections during the first quarter.

Net tax revenue increased to Rs 6.36 lakh crore, representing 22.2 percent of the FY27 Budget Estimate, compared with around Rs 5.4 lakh crore a year earlier.

Non-tax revenue also increased to Rs 3.8 lakh crore from Rs 3.7 lakh crore.

Capital Spending Picks Up

Total government expenditure during Q1 FY27 stood at Rs 13.57 lakh crore, or 25.4 percent of the full-year estimate.

Capital expenditure rose strongly to Rs 3.4 lakh crore from Rs 2.75 lakh crore in the year-ago quarter, reflecting continued government spending on infrastructure and development projects.