Fiscal deficit...

Non-debt capital receipts were ~15,534 crore, or 18.4 per cent of the full-year target, compared with 12.7 per cent last year.

The government put break on its expenditure spree, with revenue expenditure rising just two per cent in August year-on-year. Revenue expenditure for April-August came in at ~8.41 lakh crore, about 46 per cent of the full-year target, compared with 41 per cent for the first five months of 2016-17.

The biggest brunt of expenditure cut was borne by capex, which was down 26 per cent in August on a y-o-y basis. This resulted in capital expenditure to be only ~1.09 lakh crore, 35.5 per cent of the full-year estimates, down from 37 per cent for the same period last year. Till July, capex was higher in FY18, compared with April-July in FY17. “The slowdown in spending in August 2017 prevented a larger slippage in the fiscal deficit, relative to the level at end-July,” said Nayar.

On Thursday, Economic Affairs Secretary Subhash Garg had said that the Centre’s borrowing programme will be re-assessed in December, based on spending needs. Any increase in the borrowing programme raises the possibility of higher-than-budgeted spending by the Centre, and a fiscal expansion if the corresponding revenues are not realised.

Finance Minister Arun Jaitley has asked state-owned companies to spend an additional ~25,000 crore in capital expenditure this fiscal year. This would take the combined capex of the Centre and PSUs to ~4.10 lakh crore from ~3.85 lakh crore.