Govt targets debt-GDP at 50%
Finance Minister Nirmala Sitharaman on Wednesday said that the Government has envisaged a total expenditure of INR53.47 lakh crore for the next financial year, up 7.7 per cent from the current fiscal ending March 31.According to the revised estimate, the size of the budget for the current fiscal is INR49.64 lakh crore, lower from INR50.65 lakh crore estimated in February 2025. The budget for fiscal 2024-25 was at INR46.52 lakh crore.
Total expenditure is pegged at INR53.47 lakh crore in the next fiscal, much more than tax receipts, she said in reply to a discussion on the Union Budget in the Lok Sabha. The Government aims for tax receipts of INR44.04 lakh crore, 8 per cent higher than the
previous year.
Talking about capital expenditure, she said, the Government has made the highest-ever allocation of INR12.2 lakh crore, which is 4.4 per cent of the GDP. Besides, she said, the Government is following the fiscal discipline and has projected the fiscal deficit at 4.3 per cent of the GDP or INR16.95 lakh crore for FY27.
To finance the fiscal deficit, the net market borrowings from dated securities are estimated at INR11.7 lakh crore. The balance financing is expected to come from small savings and other sources. The gross market borrowings are estimated at INR17.2 lakh crore. She further said that the focus on the reduction of the debt-to-GDP ratio is part of the Fiscal Responsibility and Budget Management (FRBM).
To strive towards accepted standards of fiscal management, in Budget 2025-26, she had indicated that the central government would target reaching a debt-to-GDP ratio of 50±1 per cent by 2030-31.
In line with this, the debt-to-GDP ratio is estimated to be 55.6 per cent of GDP in BE 2026-27, compared to 56.1 per cent of GDP in RE 2025-26. A declining debt-to-GDP ratio will gradually free up resources for priority sector expenditure by reducing the outgo on interest payments.
Debunking claims of a shortage of fertilisers in the country, she said, there is enough for farmers, and the government has made a budgetary allocation of INR1.71 lakh crore for its import to support farmers.
Sitharaman also gave a point by point rebuttal to Leader of Opposition Rahul Gandhi’s claims that India has buckled under US pressure while signing the interim trade agreement with Washington.Echoing sentiments of Union Minister Kiren Rijiju, the Finance Minister said, “Koi mai ka laal paida nahi hua jo humare desh ko bech de ya kharid le (no one has the audacity to sell or buy out India).”
She said that in fact it was the Congress-led UPA government which surrendered before the World Trade Orgasnisation and sold the poor and the farmers.
