NEW DELHI: Union Finance Minister Nirmala Sitharaman, who is going to present her first budget on July 5, faces a big challenge of adjusting earnings and spending. Managing income and expenses, whether it is an ordinary citizen or a government, has always been a big challenge. Any mess can trap the Central and State governments.
According to rating agencies, the central and state governments have borrowed more than 300% of their earnings to manage their expenses. Dr Sunil Kumar, Chief Economist, India Ratings & Research, says that "the fiscal deficit of India's government budget (centre and state) in FY 2018-19 was 6.9 percent of GDP, which is far higher than the group average of 1.9% of 'BBB' with a finch rating. , is directly linked to fiscal deficit, many and other types of debt to meet this deficit.
As Union Finance Minister Nirmala Sitharaman may try to manage this fiscal deficit in her first budget. In FY19, the country's debt was 69 percent of the GDP. It was 68.2 percent in 2018 and 67.5 per cent in 2017. According to data, from 2013 to 2017, the government's debt was 341 per cent in proportion to its income, but it saw a marginal decline in 2018 and declined to 329.1 per cent. The decline is because inflation has gained a little bit of control. The new borrowing rate is also expected to come down in 2019 due to the fall in inflation.