India Ratings and Research in its latest report has said that India is set to miss its fiscal deficit target for the current financial (FY19) on account of a shortfall in revenues and lower-than-targeted disinvestment proceeds. The rating agency has estimated fiscal deficit at Rs 6.67 trillion or 3.5 percent of GDP for current fiscal. For FY19, the country fiscal deficit target has been pegged at 3.3 percent of its gross domestic product (GDP) or Rs 6.24 trillion ($88.45 billion).
It highlighted that the pressure on government finances is mainly arising from the revenue side, particularly from indirect taxes and non-tax revenue. Moreover, it stated that despite the reforms helping plug leakages in GST collections, aggregate indirect tax collections grew only 4.3 percent in the first half of the year compared with a targeted growth of 22.2 percent for the full year.
India's GST collection for last financial year (FY18) was 98 percent of the budgeted target. Besides, it said that the government is also expected to miss its disinvestment target of Rs 800 billion in 2019, given that it had received only Rs 152.47 billion till the end of October.