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Fiscal deficit at huge 61.2% of full year Budget Estimate in July-end

The data released by the Controller General of Accounts today shows that the total expenditure of the government during April-July was over Rs 5.03 lakh crore or 28.1 per cent of the entire year estimates. Of the total expenditure, plan spending was over Rs 1.32 lakh crore and under non-plan head it was Rs 3,71 lakh crore.

Revenue collection was over Rs 1.75 lakh crore or 14.8 per cent of the BE. Total receipts (from revenue and non-debt capital) of the government during the four months was over Rs 1.79 lakh crore.

The data said revenue deficit in the four months was over Rs 2.66 lakh crore or 70.4 per cent of the BE. The fiscal deficit was over Rs 5.08 lakh crore or 4.5 per cent of GDP in 2013-14. It was 4.9 per cent in 2012-13.

For entire 2014-15, fiscal deficit - gap between government expenditure and revenue - for the whole fiscal has been pegged at Rs 5.31 lakh crore or 4.1 per cent of GDP. The government had put in place a fiscal consolidation roadmap as per which the fiscal deficit has to be brought down to 3 per cent of the GDP by 2016-17.

The country’s external debt rose by 7.6 per cent to $440.6 billion in 2013-14 mainly due to rise in non-resident Indians deposits, the Reserve Bank said. India's external debt stood at $390 billion in the previous fiscal.

‘The rise in external debt was due to long-term debt particularly NRI deposits. The surge in NRI deposits reflected the impact of fresh FCNR(B) deposits mobilised under the swap scheme during September-November 2013 to tide over the difficult balance of payment (BoP) situation in the initial parts of the year,’ the central bank said in a statement.

The stock of NRI deposits in India's external debt has risen substantially recently. It increased from $47.9 billion at end-March 2010 to $70.8 billion at end-March 2013 and further to $103.8 billion at end-March 2014. The share of FCNR(B) witnessed significant rise recently due to special swap scheme during September to November 2013. At end-March 2014, the share of FCNR(B) in total NRI deposits was 40.3 per cent.

At end-March 2014, it said, long-term external debt was $351.4 billion, showing an increase of 12.4 per cent over the level at end-March 2013. At this level, long-term external debt accounted for 79.7 per cent of total external debt at end-March 2014 vis-a-vis 76.4 per cent at end-March 2013, it added.

The report said, short-term external debt stood at $89.2 billion at end-March 2014, showing a decline of 7.7 per cent over $96.7 billion at the end-March 2013. ‘This owed to the compression in import arising from the slowdown in aggregate demand and restrictions on gold imports. Thus, the share of short-term external debt in total external debt declined from 23.6 per cent at end-March 2013 to 20.3 per cent at end-March 2014,’ it said.

Government (sovereign) external debt stood at USD 81.5 billion at end-March 2014 vis-a-vis USD 81.7 billion at end-March 2013. The share of government external debt in total external debt was lower at 18.5 per cent at end-March 2014 as compared to 19.9 per cent at end-March 2013, it said.
It said that India's external debt has remained within manageable limits as indicated by the external debt-GDP ratio of 23.3 per cent and debt service ratio of 5.9 per cent during 2013-14.                    
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