NEW DELHI: Even before the coronavirus outbreak brought the economy to a shuddering halt in March, the central government's fiscal deficit surged to 10.365 trln rupees in Apr-Feb, accounting for 135.2% of the revised full-year target of 7.668 trln rupees, data released today by the Controller General of Accounts showed.
The fiscal deficit was at 134.2% of the full-year target in the corresponding period for 2018-19 (Apr-Mar).
In February, the Centre's fiscal deficit was 510 bln rupees, down 36.8% year-on-year. Total receipts rose 37.0% to 1.460 trln rupees during the month, while expenditure rose 5.2% to 1.970 trln rupees. For Apr-Feb, total expenditure was up 12.6% at 24.654 trln rupees, while total receipts were higher by 6.8% at 14.289 trln rupees.
The deterioration in the Centre's finances in February has as good as ensured that the revised fiscal deficit target of 3.8% of GDP for 2019-20 is unlikely to be met, with the spread of the coronavirus and the government's decision to announce a 21- day lockdown starting Mar 25 hitting economic activity and tax collections. Cogencis exclusively reported Monday that the Centre could be staring at a massive shortfall of 1.5 trln-2.0 trln rupees in direct tax collections this year thanks to the coronavirus-induced lockdown.
In fact, the Centre's fiscal deficit for 2019-20 is on track to breach the 4.0% of GDP for the first time since 2014-15 after it last week extended various tax-related deadlines and announced a 1.7-trln-rupee relief package for the poor affected by the national lockdown. In February, the government had invoked the escape clause provided in the Fiscal Responsibility and Budget Management Act, raising its fiscal deficit target for the current financial year by 50 basis points to 3.8% of GDP.