Budget 2019: India lets fiscal deficit targets slip this financial year and next

Reuters  |  NEW DELHI 

(Reuters) - set a fiscal deficit target of 3.4 percent of (GDP) for 2019/20, higher than a previous estimate, and also said it would breach this year's target, as an interim budget presented on Friday boosted spending for the rural sector.

The deficit for the year ending on March 31 was expected to come in at 3.4 percent of (GDP), slightly higher than the targeted 3.3 percent, the country's acting minister told the Lok Sabha.

The new targets the government had slipped from its earlier commitment to bring down the fiscal deficit to 3.1 percent of GDP by the end of March 2020, and to 3 percent by March 2021.

The higher 2019/20 fiscal deficit target is due to "need for income support for farmers", Goyal said, delivering nationalist-led government's last budget before an election that must be held by May.

The deficits were widely expected to be higher than targeted due to a combination of revenue shortfalls and increased spending ahead of the election.

(Reporting by Aftab Ahmed, and Mayank Bhardwa; Writing by Krishna N. Das; Editing by Simon Cameron-Moore)

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First Published: Fri, February 01 2019. 12:49 IST