Fiscal deficit aim of 5.3% attainable for next year, says former Chief Economic Adviser

Speaking of the key numbers he would be most interested in looking at, Dr Subramanian listed three. Firstly, he projected a real growth rate of 7%. Secondly, he anticipated growth in government revenues exceeding 13%, underpinned by a tax buoyancy ratio of 1.6. Lastly, the IMF Executive Director pointed to the fiscal deficit as the third crucial indicator, expressing his expectation that it would fall within the range of 5.3% to 5.4%. This aligns with the overarching goal of achieving a fiscal deficit of 4.5% in the fiscal year 2025–26.

Dr Subramanian debunked any claims suggesting a deviation from the prescribed glide path, asserting that the government has consistently demonstrated diligence in meeting fiscal deficit targets. He drew attention to the successful realisation of the 5.9% budget estimate for the current fiscal year, further bolstering confidence in the government's fiscal management.