Calcutta: The Centre’s fiscal deficit stood at 36.5 per cent of the full-year target at the end of the first half of FY26, aided by a spurt in capital expenditure, according to data released by the Controller General of Accounts (CGA) on Friday.
Fiscal deficit — the gap between the government’s total expenditure and revenue — was 29 per cent of the budget estimates (BE) of FY25 in the first six months of the previous financial year.
In absolute numbers, the fiscal deficit was ₹5,73,123 crore in the April-September period of FY26. The Centre estimates the fiscal deficit for the year at 4.4 per cent of the GDP, or ₹15.69 lakh crore.
“A welcome 40 per cent spike in capital expenditure widened the GoI’s fiscal deficit. Interestingly, the revenue deficit shrank to ₹27,147 crore in H1FY26 from ₹74,155 crore in H1FY25, with a muted 1.5 per cent rise in revenue expenditure, and 30.5 per cent surge in non-tax revenues offsetting the 2.8 per cent contraction in net tax revenues,” said Aditi Nayar, chief economist, Icra.
She added that the contraction in net tax revenue was an outcome of muted growth in gross tax revenues and a sharp uptick in devolution to the states.
“With an asking growth rate of over 21 per cent in H2FY26 to meet the FY26BE, we are apprehensive that taxes will undershoot the budgeted target,” said Nayar.
The government has budgeted for a net tax revenue of ₹28,37,409 crore in FY26, of which 43.3 per cent or ₹12,29,370 crore has been collected as of H1FY26.
