The government’s vaccine spend will top Rs 50,000 crore, higher than the budget estimate of Rs 35,000 crore. The figures are based on the current trends, with officials saying there is no pressure of market borrowings.
The latest data released by the controller general of accounts (CAG) on Friday shows the Centre’s fiscal deficit at Rs 5.3 lakh crore during the first half of the current financial year, which was 35% of its full year budget target as robust tax revenues helped keep government finances in much better shape. At the end of September 2020, the fiscal deficit was estimated 114.8% of the estimate.
This is being described as the best fiscal outcome in the first half of 2021-22 in about 20 years – aided largely by healthy revenues and efficient spending management. Moreover, acceleration in economic activity after lifting of curbs helped revenues recover and keep the fiscal situation in a better shape. Furthermore, receipts from excise duty were up 79% compared to the same period last year. This is largely due to the increase in global crude oil prices and the higher local taxes on fuel. It should be noted that tax revenues reached 59.6% of full year budget estimates, higher than the 28% growth in the previous fiscal year.
Government sources said the Centre is looking to tap special windows from multilateral agencies such as ADB to raise around $2 billion at concessional rates, joining others such as China and Indonesia. They said this will ensure that there is no pressure on market borrowings, leaving enough room for the private sector to raise funds.
Analysts believe the fiscal deficit numbers may be better than the estimated 6.8% of GDP. Sources said the government has also committed higher spending in several areas for which additional funds will be required.