Fiscal deficit to hit 6.1% of GDP in FY21: Govt's first advance estimates

The National Statistical Office on Thursday estimated nominal GDP at Rs 194.8 trillion - a 4.2 per cent contraction over the previous fiscal year

The Centre’s fiscal deficit will touch at least 6.1 per cent of gross domestic product (GDP) in 2020-21 (FY21). This based on the first set of advance growth estimates released by the government on Thursday, ahead of the Union Budget on February 1.

This assumes the gap between Centre’s expenditure and revenue to be at least Rs 12 trillion, based on increased borrowing announced by the government in May to deal with the Covid-19 outbreak.

However, economists estimate the full-year’s fiscal deficit to range between 7 per cent and 9 per cent of GDP, against 3.5 per cent estimated by the government