close

Long road to fiscal consolidation

Even though India needs large infrastructure investments, the government should have prioritised fiscal consolidation

Rajesh Kumar
Image
Premium

Union Budget-related commentaries are usually focused on the potential economic and financial market impact during the year. Since the economy has just recovered from an unprecedented shock, which dealt a mighty blow to public finances, it is important to assess medium-term possibilities for government finances and their implications as well. This is also essential because the government did not present medium-term fiscal projections, owing to continued global uncertainty. The government, however, has given itself a target of reducing the fiscal deficit to under 4.5 per cent of gross domestic product (GDP) by 2025-26.
As things stand, the government clearly has a challenging fiscal path ahead and will need to make sustained efforts over many years to attain Fiscal Responsibility and Budget Management (FRBM) Act targets. Let us first consider the target of 4.5 per cent of GDP. The target for 2023-24 is to reduce the fiscal deficit to 5.9 per cent of GDP from the c
Or
Disclaimer: These are personal views of the writer. They do not necessarily reflect the opinion of www-business-standard-com-nalsar.knimbus.com or the Business Standard newspaper

Also Read

Budget 2023-24: Manufacturing sector eyes revised taxations, new PLIs

Budget 2023: A look back at some major announcements in previous Budget

Union Budget 2023: Experts don't expect surprises in social sector outlay

Crypto industry wants 0.1% TDS, Sebi-like regulator in Budget 2023

Budget primer: Understanding govt expenditure and its various types

Three points for the Budget

What next for central banks?

The real cost of freebies

When $640 billion is not enough

How RBI missed the inflation surge

The Adani affair

Rooftop solar for poverty alleviation

With some help from the predecessor

Salaried employment rises in Gujarat

Pathaan, fan clubs, and single screens

First Published: Feb 22 2023 | 10:47 PM IST

Explore News

To read the full story, subscribe to BS Premium now, at just Rs 249/ month.

Key stories on business-standard.com are available only to BS Premium subscribers. Already a BS Premium subscriber?LOGIN NOW

Register to read more on Business-Standard.com