The Union Minister, Piyush Goyal who is currently announcing the Interim Budget for 2019, instead of Finance Minister, Arun Jaitley has announced that the Fiscal Deficit for fiscal 2019-2020 has been revised and is seen at 3.4 percent. The government has slightly slipped its previous target with respect to fiscal deficit which was earlier announced at 3.3 percent. The current account deficit stands at 2.5% of the GDP (gross domestic product).
The term fiscal deficit refers to the government's total expenditures exceeding the revenue that it generates and it excludes the money from borrowings. The word deficit differs from the debt which is an accumulation of yearly deficits.
The top bankers in India, both SBI and HSBC had expected the government of India to meets its earlier set target of 3.3 percent of GDP for FY 2019, where as the AXIS Bank and Kotak Mahindra Bank had expected the government to miss the target by around 20 basis points and to settle at 3.50 percent as per the report from Bloomberg.
Previously, the government had budgeted fiscal deficits of Rs 6.24 lakh crore (3.3 percent of GDP) for fiscal 2019. The country's fiscal deficit between April 2018 - November 2019 were recorded at Rs 7.16 lakh crore, which is slightly more than the previous years record for the same time.
Even last year, the government missed its earlier fixed fiscal target and ended at 3.5% of GDP as against its budgeted figure of 3.2% of GDP.
The fiscal deficit during April - October 2018 surged up by 23.5% year - on - year (YOY) and this crossed the budget estimate for the full financial year despite finding solace by declining crude oil prices in the global market.
This year, the fiscal situation is slightly tricky because the government's revenue has been below trend due to decline in tax collections.