Govt committed to improve quality spending, cut fiscal deficit to 4.5% in FY26: Finance Ministry report

Government aims to improve spending quality, strengthen social security, and reduce fiscal deficit to 4.5% of GDP by FY26.

The government will continue its focus on improving quality spending, strengthening the social security net and bring down the fiscal deficit to 4.5% of the GDP in FY26, a Finance Ministry document said.

Finance Minister Nirmala Sitharaman is schedule to present the Budget for 2025-26 in Parliament on February 1, 2025.

The Union government is committed to pursuing the glide path of fiscal consolidation as announced in the Budget for FY 2021-22 and to attain a level of fiscal deficit lower than 4.5% of GDP by FY 2025-26, according to Finance Ministry statements on the half yearly review of the trends in receipts and expenditure and deviation in meeting the obligations of the government under the Fiscal Responsibility and Budget Management Act, 2003.

The statements were tabled in the Lok Sabha last week.

“The thrust will be on improving the quality of public spending, while at the same time, strengthening the social security net for the poor and needy. This approach would help further strengthen the nation’s macro-economic fundamentals and ensure overall financial stability,” it said.

According to the statements, the Budget 2024-25 was presented in the backdrop of global uncertainties caused by the wars in Europe and the Middle East.

India’s sound macro-economic fundamentals have cushioned the country from the vagaries afflicting the global economy.