Govt Spends 30% of FY18 Budget in First Quarter
New Delhi: The government’s fast-paced spending continued in June, with over 30% of budget committed for the year already exhausted in the first quarter.
Capital spending in first quarter was pegged at 22.1% of the budget estimate, data released on Monday showed, higher than 19.9% at the same time last year.
High expenditure that has followed early presentation of the budget has pushed fiscal deficit well above the trend, but experts are not sounding the alarm yet. At the end of June, fiscal deficit was 80.8% of budget estimate compared with 61.1% at the end of June 2016. The government has spent ₹ 68,328 crore of its ₹ 3.1 lakh croreplus capital budget by June, 39.4% more than the amount spend in the corresponding period last year.
Total receipts added up to 13.1% of budget estimate compared with 12.8% last year, clearly suggesting that the higher fiscal deficit is on account of faster government spending at the start of the year.
Revenue deficit in first three months was 119.1% of the budget estimates, much higher than 79.6% in the precious corresponding period. The government had completed the budget process before the start of new financial year by advancing the budget presentation by a month. This has allowed a quick start to spending, which was not the case earlier when the budget process spilled over to almost first two months of new fiscal.
The fiscal situation should correct as revenues pick up and spending evens out.
Tax revenues were marginally lower at 14.5% of budget estimate, against 14.9% in the earlier year, largely due to slow growth in excise collections on account of disruption due to the rollout of goods and services tax.
Quick start to disinvestment has provided some support to rapid spending. The government has already raised about ₹ 8,000 crore against the budget target of ₹ 72,500 crore.