Govt retains Rs. 12-lakh cr. borrowing plan - The Hindu - 01/10/2020
India’s fiscal deficit soared to 109% of the Budget target in just the first five months of the year (2020-21), with revenues remaining muted.
The revision was necessitated owing to the COVID-19 pandemic. The government has retained its Rs.12 lakh crore borrowing plan.
Experts suggest that the government is leaving some room for States who also have to do ‘major borrowings’ as well as the private sector to raise money in the second half of the year.
It was earlier announced that the estimated gross market borrowing in FY 2020-21 will be Rs.12 lakh crore.
Revenue collections were largely to blame for the fiscal deficit amounting to Rs.8.70 lakh crore compared to the target of Rs.7.96 lakh crore. Also, tax revenue has seen a decline across the board.
The government resorts to market borrowing to make up for the mismatch between its revenue and expenditure.