India’s Fiscal Deficit at ₹5.73 Lakh Crore for April–September, 36.5% of FY26 Target

India’s fiscal deficit for the April–September period stood at ₹5.73 lakh crore, accounting for 36.5% of the full-year target, according to official data. This compares with 29.4% of the target during the same period last year, reflecting higher spending and revenue adjustments.

Key Fiscal Indicators

• Fiscal Deficit: ₹5.73 lakh crore (36.5% of FY26 target)
• Total Receipts: ₹17.30 lakh crore (49.5% of budget estimate)
• Total Expenditure: ₹23.03 lakh crore (45.5% of target)
• Revenue Receipts: ₹16.95 lakh crore, including ₹12.29 lakh crore in tax and ₹4.66 lakh crore in non-tax revenue

The revenue deficit stood at ₹27,147 crore, or 5.2% of the annual target.

Drivers of Revenue Performance

Non-tax revenue rose sharply, supported by the Reserve Bank of India’s ₹2.69 lakh crore dividend to the Centre. This helped partially offset the fiscal gap amid sustained capital expenditure.

Government’s Fiscal Strategy

The government aims to reduce the fiscal deficit to 4.4% of GDP in FY26, aligning with its medium-term goal of bringing the gap below 4.5% by FY26. This target is expected to be supported by buoyant tax inflows and continued infrastructure spending.

Capital formation and robust tax collections will remain key to meeting fiscal targets. The government’s strategy focuses on balancing revenue mobilisation with growth-oriented expenditure to maintain fiscal discipline.

Read More: India's Economy Projected to Grow at 6.7% Annually.

Conclusion

India’s fiscal position for H1 FY26 reflects higher spending and strong non-tax revenue inflows. With a clear roadmap to reduce the deficit to 4.4% of GDP, the government is banking on sustained tax buoyancy and capital investment to achieve its fiscal consolidation goals.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.