Lok Sabha Question No. 2247 (UNSTARRED), answered on 2016-05-06
Subject: FRBMA
Ministry: FINANCE
Asked by: DODDAALAHALLI KEMPEGOWDA SURESH, SRINIVAS KESINENI, BHOLA SINGH

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## GOVERNMENT  OF INDIA MINISTRY OF FINANCE DEPARTMENT  OF ECONOMIC AFFAIRS

## LOK SABI{A T NSTARRED  QUESTION  NO. 2247 To BE ANSwERED oN FRIDAy rHE 6rn May 2016

lvArsAKrrA  16, 1938 (SAKA)I

## FRBMA

2247. SHRI D.K. SURESH: SHRI KESINENI  NAM: SHRI BHOLA SINGH:

Will the Minister of FINANCE  be pleased  to state:

- (a) the details  of the steps taken by the Govemment  to move on the path of reduction in revenue  deficit  and fiscal deficit as per the mandate of the Fiscal Responsibility and Budget Management  (FRBM) Act and achievement thereon  during each of the last three years;
- (b) the details of shortfall, if any, found in the FRBM  and the action taken or proposed  to be taken by the Govemment thereon;
- (c) the sources  through which  the Govemment has attempted to raise additional  funds;
- (d) the quantum  of funds used for payment  of interest on borrowings  by the Govemment; and
- (e) the near term fiscal deficit  target for the country and steps taken or proposed  to take to achieve the same?

## ANSWER

## MINISTER OF STATE FOR FINANCE  (SHRI JAYANT SINHA)

- (a) Government  is committed to carry forward the process  of fiscal consolidation as per targets  assigned by the FRBM Act / rules. Fiscal consolidation has been designed with judicious  mix of rationalization  in total expenditure as a percentage  of GDP and improvement in gross tax and non-tax revenues as a percentage of GDP with improved balance  between  revenue and capital expenditure.

Details  of fiscal  deficit  and revenue deficit of the Central Government during  last three years are as below:

| Financial Year   | Fiscal Delicit   | Fiscal Delicit   | Revenue Deficit   | Revenue Deficit   |
|------------------|------------------|------------------|-------------------|-------------------|
|                  | { crore          | % ofGDP          | { crore           | % ofGDP           |
| 201s-16 (RE)     | 5,35,090         | 3.9              | 3,41,589          | 2.5               |
| 2014-15          | 5,1 0.8 1 7      | 4.1              | 3,65,61l          | 2.9               |
| 2013-r4          | 5,02,863         | 4.4              | 3,5 7,053         | 1,)               |

Source: Controller  General ofAccounts& Budget  documents

Note: GDP at curent prices,  2011-12 series  RE: Revised Estimates

(b) Keeping in view the reduced fiscal space foltowing  implementation  of the FourteenthFinance Commission  recommendations relating to higher devolution of taxes to States the FRBM Act,2003 was amended in the year 2015 and the FRBM (amendment) rules,2015 were notified. As per this amendment, timeframe to achieve  the deficit targets  has been extended to 31" March,20t8. Govemment is committed to carry forward  the process of fiscal  consolidation  as mandated by the FRBM Act / rules.

(c) The Government's  efforts are towards augmenting all sources of revenue  i.e. from both tax and non-tax revenues. To mobilize higher amount  of tax resources, Government has been taking legal, administrative and technological  measures  for broadening tax base and increasing  tax realisation efforts by extensive  use of information  technology  to enhance voluntary  compliance and deter non-compliance.

(d) In FY 2014-15, interest payments  of the Government  was 74,02,444 crore. ln Revised Estimates (RE) 2015-16 and Budget Estimates  (BE) 2016-17,  interest  payment is estimated at <4,42,620 crore,  74,92,67  0 crore respectively.

(e) In BE 2016-17, fiscal deficit  is estimated  at 3.5 per cent of GDP.  To achieve  this target, measures  for mobilization of higher amount of resources  through  both tax and non-tax revenues along with expenditure  management, including subsidy reforms etc. have been taken in Budget 2016-17.