What is the issue ?
- Government's fiscal deficit stands at 112% of the amount budgeted for the entire financial year which ends in March.
What is meant by 'fiscal deficit' ?
- The difference between total revenue and total expenditure of the government is termed as fiscal deficit. It is an indication of the total borrowings needed by the government.
Where has it gone wrong ?
- There is no problem in the expenditure part of the budget.
- The problem lies with the revenue part of the budget. The revenue stands at only 53% of the year's target.
Will the government's Rs 50,000 crore borrowing worsen the issue ?
- No, not according to the government. The government pointed out that additional borrowing would be offset by trimming down the collections from its Treasury Bills.
So is this 'slippage' of fiscal deficit target a bad thing ?
- As long as it is driven by an increase in expenditure on developmental activities like low cost housing, rural roads and irrigation, there is no need to be pessimistic.