New Delhi, June 30 (IANS) India’s fiscal deficit stood at Rs 1.624 lakh crore in April-May of financial year 2026-27, which accounts for 9.6 per cent of the full-year target, data released by the Controller General of Accounts (CGA) showed on Tuesday.

The government has fixed a fiscal deficit target of Rs 16.96 lakh crore for the full financial year (FY27), which shows that the figures for the first two months reflect a strong fiscal position with the country on track to meet the target set in the Budget for 2026-27.

In the corresponding period of FY26, the fiscal deficit stood at Rs 13,163 crore, or 0.8 per cent of the full-year target.

The Government recorded a fiscal surplus of Rs 2 lakh crore in May, compared with a surplus of Rs 1.73 lakh crore in May last year. In April, the government had reported total receipts of Rs 2.13 lakh crore and total expenditure of Rs 5.75 lakh crore, which left a fiscal deficit of around Rs 3.62 lakh crore for the first month of the financial year, according to the monthly data.

Non-tax revenue stood at Rs 3.27 lakh crore in May, compared with Rs 2.90 lakh crore in the same month last year. The May number came after the Reserve Bank of India’s Central Board approved a surplus transfer of Rs 2.87 lakh crore to the central government for FY26.

Capital expenditure in May stood at Rs 61,200 crore, compared with Rs 61,600 crore in the same month of the previous year. For April-May, however, capital expenditure rose to Rs 2.51 lakh crore from Rs 2.21 lakh crore a year earlier.

Gross tax revenue for April-May stood at Rs 5.25 lakh crore, compared with Rs 5.15 lakh crore in the same period last year, the data showed.

The Government achieved its fiscal deficit target of 4.4 per cent in the financial year 2025-26 and has lowered the target further to 4.3 per cent of GDP for the current financial year as part of the fiscal consolidation process.

A decline in the fiscal deficit strengthens the fundamentals of the economy and paves the way for growth with price stability. It leads to a reduction in borrowing by the government, thus leaving more funds in the banking sector for lending to corporates and consumers which leads to higher economic growth.

–IANS

sps/na