The Finance Ministry today said the Union government's financial position has improved during the first five months of the current fiscal, driven mainly by buoyancy in revenue collections and increase in non-tax revenue on account of sale of spectrum.
"The fiscal position of the government during April-August 2010 showed improved performance in terms of key deficit indicators due to buoyant revenue collections," said the second quarterly debt management report released by the Finance Ministry.
The increase in non-tax revenue was primarily on account of telecom receipts, the report said, adding "tax revenue was added by buoyancy in excise collections which showed a growth of 43.3 per cent during April-August 2010."
The central government received Rs 1.08 lakh crore from sale of 3G spectrum and Broadband Wireless Access (BWA) against a target of Rs 35,000 crore. The buoyancy in excise collection can partially be attributed to withdrawal of stimulus -- through increase in excise duties.
The report further said that the aggregate expenditure of the Centre too went up, both on capital and revenue sides. During April-August, the expenses worked out to be 40 per cent of the budget estimates, compared to 33.6 per cent during the corresponding period last year.
However, it added, "Notwithstanding the increase in expenditure, revenue deficit and gross fiscal deficit the first five months of the current fiscal year at 36.3 per cent and 39.7 per cent of BE were lower than those during the corresponding period of the previous fiscal."
The report further said that the public debt of the Centre increased by a modest 2.8 per cent in the quarter ending September, as compared to a rise of 4.2 per cent in the previous quarter.
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In absolute terms, total public debt, including external debt, at end-September was Rs 27.77 lakh crore.
The internal debt of the government at Rs 24.84 lakh crore on September 30, 2010, the report said, was 35.8 per cent of the GDP, up from 34.7 per cent at the end-June 2010.
The report, however, pointed out that average maturity of outstanding government stock at the end of September 2010 improved to 9.83 years from 9.71 years at the end of June, while the weightage average coupon of outstanding stock went down from 7.85 per cent to 7.79 per cent.
The report further said that though 10-year bond yield increased from 7.58 per cent at the end of June to 7.87 per cent at end September on the back of RBI's monetary policy, "the yields were capped from rising too high by the sharp decline in US treasury yields, following concerns of economic slowdown".