Govt Spends More on Infra, Fiscal Deficit Hits 18.2%

The Centre's fiscal deficit for the April-June quarter of FY27 reached ₹3.1 lakh crore, accounting for 18.2% of the full-year budget estimate. This figure is a slight increase from the ₹2.8 lakh crore recorded in the same period last year. The government's finances benefited from robust tax collections, with net tax revenue rising to ₹6.4 lakh crore, up from ₹5.4 lakh crore a year prior.

Expenditure also rose, with total spending reaching ₹13.6 lakh crore in the first three months of FY27. A key driver of this increase was capital expenditure, which more than doubled to ₹3.4 lakh crore from ₹2.75 lakh crore in the corresponding period of the previous fiscal year. This heightened spending on infrastructure aligns with the government's strategy to bolster economic growth through public investment.

The government has budgeted a fiscal deficit of ₹16.96 lakh crore for FY27, equivalent to 4.3% of the GDP. This outlay is supported by both increased net tax revenue and non-tax revenue, which includes dividends and spectrum income. The Finance Minister aims to maintain fiscal consolidation while supporting growth.