Fiscal Deficit Likely at 4.75% for FY25, Capex at ₹62,000 Crore

India’s fiscal deficit for the financial year 2024-25 is projected to be 4.75% of GDP, according to a report by India Ratings and Research (Ind-Ra).

The report also anticipates capital expenditure to reach ₹62,000 crore as the government continues its focus on infrastructure development.

Sustained Fiscal Discipline Amid Economic Challenges

Despite global economic uncertainties, the Indian government is expected to maintain its fiscal consolidation efforts. The projected fiscal deficit is in line with the roadmap to achieve medium-term fiscal sustainability, showcasing the government’s commitment to prudent financial management.

Increased Capex to Boost Growth

Capital expenditure for FY25 is pegged at ₹62,000 crore, signaling robust investment in infrastructure and development projects. Ind-Ra highlights that this increased spending is crucial for sustaining India’s growth momentum and achieving long-term economic objectives.

Strategic Focus on Growth

The report underscores the importance of balancing fiscal discipline with growth imperatives. Higher capex is expected to catalyze economic activity, particularly in sectors like transportation, energy, and urban infrastructure, thereby reinforcing India’s resilience against global headwinds.

As FY25 approaches, the government’s fiscal strategy will play a pivotal role in shaping economic outcomes, ensuring stability, and fostering inclusive growth.