The second wave of Covid-19 infections left government finances relatively unscathed compared to the first wave, according to government account data for the quarter ended June.
Fiscal deficit for the first quarter of the ongoing financial year stood at Rs 2.74 lakh crore, or 18.2% of the budget estimate, the data, released by the Controller General of Accounts on Friday, showed.
Fiscal deficit for the quarter ended June 2020 was 83.2% of the budget estimate. It was 61.4% during the same period in 2019.
For FY22, the government has budgeted for a fiscal deficit of 6.8% of GDP.
“The sharp jump in tax and non-tax receipts and mild contraction in revenue expenditure, curtailed the Government of India’s fiscal deficit to an eight-year low in Q1 FY22—less than half of last-year’s level of Rs 6.6 lakh crore recorded during the nationwide lockdown,” said Aditi Nayar, chief economist at ICRA.
The April-June revenue deficit stood at Rs 1.7 crore, or 14.9% of the budget estimate. It stood at 94.8% of the budget estimate for the quarter ended June 2020 and at 79.4% during the same period the year before.
Higher tax and non-tax revenue, alongside slightly lower expenditure, helped improve government finances.
Total revenue receipts during April-June 2021 was Rs 5.4 lakh crore, or 30.2% of budget estimate. During the same period a year ago, total revenue receipts were at 7.4% of budget estimate.
Net tax revenue of Rs 4.1 lakh crore was collected during the first three months of the fiscal—that’s 26.7% of the budget estimate compared to 8.2% in the quarter ended June 2020.
Non-tax revenue, too, jumped to Rs 1.3 lakh crore, or 52.4% of the budget estimate, compared to 3.9% in the corresponding period in the preceding financial year.
Total expenditure for the first three months of the ongoing fiscal stood at Rs 8.2 lakh crore, or 23.6% of budget estimate. The government spent 26.8% of its budget expenditure during the same period in the preceding fiscal.
Revenue expenditure stood at Rs 7.1 lakh crore, or 24.2% of budget estimate, compared to 27.7% in the same period in the preceding fiscal.
Capital expenditure stood at Rs 1.1 lakh crore, or 20.1% of the budgeted estimate. That was lower than capital expenditure of 21.4% of the budget estimate in the same period a year ago.