New Delhi, July 2: India’s central government fiscal deficit widened to ₹1.62 trillion during April–May of FY27, driven by higher expenditure on subsidies and increasing interest payments, according to a recent report.
The rise in deficit reflects increased government spending in key welfare and financial obligation areas during the initial months of the fiscal year. Analysts note that elevated subsidy allocations and debt servicing costs have contributed significantly to the widening gap.
Despite the increase in fiscal deficit, overall expenditure trends remain aligned with budgetary commitments for the fiscal year. Officials are expected to monitor spending patterns closely in the coming months to maintain fiscal discipline.
The report highlights the importance of balancing developmental expenditure with fiscal consolidation goals as the government progresses through FY27.