The upcoming Budget is going to put emphasis on easing the debt-to-GDP ratio, which is around 56%, instead of targetting a specific fiscal deficit number as the country has almost reached the end of the glide path envisaged in the FRBM legislation. A fiscal deficit of 3-4% is considered comfortable and a desirable target for a growing, developing economy like India, aiming to balance economic expansion with financial stability.
Under the revised Fiscal Responsibility and Budget Management (FRBM) Act, the fiscal deficit target was below 4.5% of GDP for 2025-26. Therefore, the union government announced a new glide…