Modi govt confident of meeting fiscal deficit target but faces challenges

The government is confident of meeting the fiscal deficit target for the year and has reiterated that confidence even after the recent excise duty cut on petrol and diesel, which will lead to a total revenue loss of Rs 105 billion. Of this, the Centre will bear about Rs 61 billion, as 42 per cent of the proceeds from duties are passed on to the states. 

While the direct tax collections so far are encouraging, other indicators show the Centre has a formidable task. Going by available trends, there could be a shortfall of more than Rs 1 trillion in