Government confident of meeting FY18 fiscal deficit target, says Economic Affairs Secretary

With India's April-February fiscal deficit having already crossed 120 per cent of the full year's target, the government on Thurday said it was confident of keeping the deficit within the targeted 3.5 per cent range. The data released by the Comptroller General of Accounts (CGA) on Wednesday showed that India's budgetary fiscal deficit for the 11 months ended in February stood at 120.3 per cent -- Rs 7.15 lakh crore -- of the full year`s revised target of Rs 5.94 lakh crore.

Economic Affairs Secretary Subhash Chandra Garg said the CGA data was only till February-end and that the latest numbers available till March 28 "are very close to revised estimates". 

"Fiscal accounts numbers released yesterday (Wednesday) indicated end-February position. We now have flash numbers until March 28. We are very close to RE (revised estimates) for both fiscal deficit and revenue deficit. (We are) Quite confident that fiscal deficit will be within 3.5 per cent of GDP," Garg tweeted.

Meanwhile, the government on Wednesday said it has decided to make additional borrowing of Rs 50,000 crore this fiscal through dated securities, a move that may put burden on the fiscal deficit target of 3.2 per cent of GDP.

However, there will be no change in the net borrowing as envisaged in the Budget for 2017-18, a Finance Ministry statement said.

After the review of the borrowing programme with the RBI, it was decided that “the government will raise additional market borrowings of Rs 50,000 crore only in fiscal FY’18 through dated Government securities.”

Besides, it will trim down the Treasury Bills from present collections of ₹86,203 crore to ₹ 25,006 crore by March 2018. T-Bills are securities with short-term duration of less than one year while dated securities have maturity of over five years.

“The government will thus, between now and March 2018, not be raising any net additional borrowing (T-Bills will be run down by ₹61,203 crore and additional G-Sec borrowing will be ₹ 50,000 crore),” it said.

In the Budget for 2017-18, gross and net market borrowing were pegged at ₹5.80 lakh crore and ₹4.23 lakh crore respectively, with ₹3.48 lakh crore being raised (net) from dated Government securities and ₹2,002 crore from T-bills, a Finance Ministry statement said.

Noting that borrowings till December 26, 2017, have been conducted in line with the borrowing calendar fixed for the fiscal, it said, gross and net market borrowings are ₹5,21,000 crore and ₹3,81,281 crore, excluding buyback/switches, respectively as on December.

As against the budgeted net T-bills receipt of ₹2,002 crore, net collections till December 26, 2017 are ₹86,203 crore, it said.