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Govt's budget under strain from Day 1 of new fiscal year

Nirmala Sitharaman India virus economy Government strain
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India kicks off its fiscal year with revenues under severe strain. A prolonged slowdown in the economy depressed tax collections in the financial year that ended Tuesday, latest official data show.

As India now conducts the world’s biggest lockdown, budget pressures are set to worsen. Finance Minister Nirmala Sitharaman has already outlined a virus relief package of 1.7 trillion rupees ($22.5 billion) and may be planning more support.

That could push up the government’s fiscal deficit target to as high as 6.2% of gross domestic product in the current year, according to Fitch Solutions, compared with the government’s target of 3.5%.

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