Finance Minister Nirmala Sitharaman, in her Budget speech on Saturday, February 1, 2025, announced that the fiscal deficit for the fiscal year 2025–26 is estimated to be 4.4% of India’s Gross Domestic Product (GDP).
Sitharaman had previously stated that the government targets achieving a fiscal deficit of 4.5% in 2026–27. The government’s fiscal deficit represents the gap between its expenditure and income.
Sitharaman also revised the fiscal deficit for the current fiscal year (April 2024–March 2025) to 4.8% of GDP, down from the previously estimated 4.9%.
The Finance Minister revealed that the gross market borrowing for FY26 is estimated at ₹14.82 lakh crore, with net market borrowing pegged at ₹11.54 lakh crore. For FY25, the gross borrowing was ₹14.01 lakh crore.
The borrowing numbers are closely watched by the market, particularly in light of lower dividends expected from the Reserve Bank of India (RBI) in FY26, compared to ₹2.11 lakh crore in FY25. Net tax receipts for FY26 are estimated at ₹28.37 lakh crore.
Sitharaman reiterated that the Budget aims to unlock India’s potential for greater prosperity, asserting that the Indian economy is the fastest-growing among all developing economies. This marks the 14th consecutive Budget presented under the Narendra Modi government since it came to power in 2014.
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Published on: Feb 1, 2025, 12:34 PM IST
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