India's Fiscal Deficit Hits 7.1 Lakh Crore by August

The Government of India recorded a fiscal deficit of 7.1 lakh crore during the first five months of FY27, spanning April through August. This figure represents 41.9% of the government's full-year budget target. Data from the Controller General of Accounts indicates a sharp increase in the August deficit to approximately 2.5 lakh crore, nearly double the 1.29 lakh crore recorded in August of the previous year.

Total government expenditure for the period reached 20.78 lakh crore, while total receipts stood at 13.67 lakh crore. The spending increase was driven by capital expenditure on infrastructure and asset creation, which rose to 5.10 lakh crore.

Finance Minister Nirmala Sitharaman has set the full-year fiscal deficit target at 4.3% of GDP, or 16.96 lakh crore. To manage these finances, the central government announced plans to borrow 7.86 lakh crore in the second half of the fiscal year, which includes 15,000 crore through Sovereign Green Bonds.