Fiscal Deficit
-
Fiscal Deficit is the difference between total revenue and total expenditure of the government.
-
The borrowings are not included while calculating the total revenue.
-
Fiscal Deficit gives an indication about the total borrowings required.
What were the revised fiscal deficit targets for the centre and state?
-
Centre: Need to reach a fiscal deficit level of 4.5 per cent of gross domestic product (GDP) by 2025-26 from the current level of 9.5 per cent.
-
States: The target for the combined fiscal deficit of the states has been set at 4 per cent of GDP for 2021-22. Further, they must reach a deficit level of 3 per cent of GDP by 2023-24.
Status:
-
It is expected that Centre would achieve a 2.7 percentage point reduction in the deficit from 9.5% in 2020-21 to 6.8% in 2021-22.