Securing Hannav Ledger...
Securing Hannav Ledger...
Glossary
Fiscal deficit is the gap between government total expenditure and total receipts excluding borrowings, financed through market borrowing.
Fiscal deficit is how much the government spends beyond its income — it borrows to fill the gap, affecting interest rates and bonds.
Key macro indicator in Union Budget. High deficit may crowd out private borrowing, push gilt yields up, and influence RBI rate policy. Fiscal Responsibility and Budget Management Act targets long-term consolidation path.
Union Budget projects fiscal deficit 5.1% of GDP — government borrows roughly ₹15+ lakh crore via G-Secs affecting debt fund returns and bank FD rates indirectly.
Higher deficit may raise government bond yields, affecting debt fund NAVs and eventually loan rates. Equity impact mixed via growth vs rates.
Revenue deficit is excess of revenue expenditure over revenue receipts. Fiscal deficit includes capital spending financed by borrowing.
Counter-cyclical policy may warrant deficit during slowdowns. Sustainable level balances growth stimulus with debt stability.