Risks of revised estimates

How a potential fiscal deficit of 4.65% of GDP was brought down in the 2019-20 revised estimates

A closer look at the expenditure numbers presented in the Union Budget for 2020-21 offers fresh insights on how the Union government has tried to manage its finances for the current year. They also add a new dimension to the government’s efforts to reduce expenditure in the current year to restrict the slippage in fiscal deficit to only 0.5 percentage point.

The need for slashing expenditure in 2019-20 was acute as the government’s revenue estimates, provided in July 2019, went completely awry. Net tax revenues fell short by Rs 1.45 trillion and disinvestment revenues were lower than the estimates by Rs