The report highlighted that the fiscal deficit for April-Might FY26 stood at simply Rs 0.13 lakh crore, which is barely 0.8 per cent of the Funds Estimates (BE).
This can be a main enchancment in comparison with the identical interval final yr, when the fiscal deficit was Rs 0.51 lakh crore or 3.2 per cent of the Revised Estimates (RE).
The higher fiscal place has been supported by a robust rise in income receipts, particularly a file dividend of Rs 2.69 lakh crore from the Reserve Financial institution of India (RBI).
It said, “General, the monetary yr has taken off on a promising be aware from the angle of the federal government's contribution to development dynamics”.
The report additionally talked about that the income receipts in April-Might FY26 rose by 24 per cent year-on-year. Tax revenues elevated by 10 per cent, whereas non-tax revenues jumped by 41.8 per cent. In the meantime, the federal government continued its deal with capital spending to help financial development. Capex in April-Might FY26 elevated by 54 per cent year-on-year to Rs 2.21 lakh crore, in comparison with Rs 1.44 lakh crore in the identical interval final yr. This represents 19.7 per cent of the full capex budgeted for the yr at Rs 11.21 lakh crore, exhibiting that the federal government is frontloading spending to stimulate demand.
To fund the fiscal deficit, the federal government used a mixture of market borrowings and small financial savings. Market borrowings had been Rs 0.98 lakh crore (9 per cent of BE) and small financial savings contributed Rs 0.63 lakh crore (18 per cent of BE).
As well as, the federal government's money steadiness stood sturdy at Rs 3.27 lakh crore as of Might 2025, giving it flexibility to help additional expenditure.
The report famous that the large RBI dividend has opened up further coverage house for capex by round Rs 60,000 crore or 0.15 per cent of GDP. Whereas there's a probability that slower GDP development as a consequence of decrease inflation may have an effect on fiscal targets,
It added that the federal government stays dedicated to decreasing the fiscal deficit to 4.4 per cent of GDP in FY26, it might be lowered it additional right down to round 4.2-4.3 per cent.
General, the information for April and Might reveals that the federal government is sustaining a steadiness between fiscal self-discipline and growth-supportive spending.
