New Delhi: Dec 18; Government today said it is on course to meet the fiscal deficit target of 3.9 per cent of GDP for 2015-16, and 3.5 per cent next fiscal, despite pressure of additional outgo on account of the 7th Pay Commission and OROP.
"We will absolutely meet our fiscal consolidation roadmap. We have said that the 3.9 per cent fiscal deficit target this year is well in hand.
"Next year we have said a fiscal deficit target of 3.5 per cent that took into account the impact of the 7th Pay Commission, One Rank One Pension (OROP), that was very much included in our modelling...," Minister of State for Finance Jayant Sinha told reporters outside Parliament.
In the mid-year analysis tabled in Parliament, the government lowered the economic growth forecast for 2015-16 to 7-7.5 per cent from 8.1-8.5 per cent projected in February.
It said slower-than-anticipated nominal GDP growth (8.2 per cent versus budget estimate of 11.5) will itself raise the deficit target by 0.2 per cent of GDP. The anticipated shortfall in disinvestment receipts, owing to adverse market conditions for a portfolio that largely comprises commodity stocks, will add to the challenge.
"But tax collections are buoyant," it said. That plus the additional revenue measures like Swachh Bharat cess and increase in excise, will ensure that central government's target will be met.