Outlining a positive outlook for the just begun financial year, Finance Minister P Chidambaram on Saturday said that the fiscal deficit for FY14 will be better than 5.2 per cent as tax collection target of over Rs10.38 lakh crore has been achieved.
In fact while highlighting the rosy fiscal outlook, he even dismissed all speculations regarding early lok Sabha elections, saying that “why should the Government expect an early electionIJ (After) all that I have highlighted (about the economy), does that point towards early electionsIJ It points to completing our agenda for 2013-14 and then going for elections in the month of May (2014)”.
“As always there will be some savings (on expenditure). So what does it mean ... If we reach the revenue target and if there are some savings, the fiscal deficit will be better than 5.2 per cent that I have projected,” he said while addressing a press conference.
At the same time though he chose not to comment on the actual fiscal deficit number for 2012-13.
On revenue collections, Chidambaram said while there was a slippage on direct taxes front, the indirect tax mop up has exceeded the revised estimates.
“In terms of indirect taxes (collection) there was excess over the target. In direct taxes, there was a shortfall over target. But overall we have achieved the target of over Rs10.38 lakh crore,” he explained, adding that the revenue growth in 2012-13 was 16.7 per cent.
As per the revised estimates, the aim was to collect over Rs5.65 lakh crore from direct taxes and Rs 4.69 lakh crore from indirect taxes. Total expenditure was pegged at Rs 14.30 lakh crore.
With savings in expenditure, the fiscal deficit is expected to be lower than 5.2 per cent as projected in revised estimates. As per Government's fiscal consolidation road map, the gap between revenue and expenditure is to be brought down to 4.8 per cent by 2013-14 and to 3 per cent by 2016-17.
The Finance Minister also exuded confidence that the revenue target for 2013-14 financial year would be achieved as the GDP growth is likely to be over 6 per cent.
To a query on the record high current account deficit (CAD) in the October-December quarter of 2012-13, he said the final numbers for the financial year would be more tolerable.