Says total budget size for FY24 (total expenditure) will be Rs 45 trillion, compared with revised estimates (RE) of FY23 of Rs 41 trillion
New Delhi, NFAPost: Finance Minister Nirmala Sitharaman announced in her 2023 Union Budget speech that the central government is expected to achieve its fiscal deficit target for the current financial year (FY23) of 6.4% of GDP, and is targeting a fiscal deficit of 5.9% of GDP for FY24.
“In my Budget Speech for 2021-22, I had announced that we plan to continue the path of fiscal consolidation, reaching a fiscal deficit below 4.5% by 2025-26 with a fairly steady decline over the period. We have adhered to this path, and I reiterate my intention to bring the fiscal deficit below 4.5% of GDP by 2025-26,” she said.
The fiscal deficit is the difference between a government’s expenditure and revenues when the former is higher.
Sitharaman said that the total budget size for FY24 (total expenditure) will be Rs 45 trillion, compared with revised estimates (RE) of FY23 of Rs 41 trillion. The budget estimate (BE) for FY23 was Rs 39 trillion.
“Coming to 2023-24, the total receipts other than borrowings and the total expenditure are estimated at Rs 27.2 trillion and Rs 45 trillion respectively. The net tax receipts are estimated at Rs 23.3 trillion,” she said.
In the current financial year the RE for total receipts stands at Rs 24.3 trillion in the current financial year.
Sitharaman said that the centre will continue its focus on capital expenditure, which has been increased to Rs 10 trillion for FY24, compared with FY23 RE of Rs 7.3 trillion and BE of Rs 7.5 trillion. This will include the continuation of 50-year, interest-free loans to states for their capex needs. That support has been increased by Rs 30,000 crore for FY24 to Rs 1.3 trillion.
She said the capex loan amount to states has to be spent within FY24.
“Most of this will be at the discretion of states, but a part will be conditional on states increasing their actual capital expenditure. Parts of the outlay will also be linked to, or allocated for purposes including scrapping old government vehicles, urban planning reforms and actions, financing reforms in urban local bodies to make them creditworthy for municipal bonds and state share of capital expenditure of central schemes, among others.
The Finance Minister said that states to be allowed fiscal deficit upto 3.5% of the Gross State Domestic Product (GSDP), of which 0.5% will be tied to power sector reforms.
