INSUBCONTINENT EXCLUSIVE:
Score company ICRA has stated that missing disinvestment target may trek financial deficit in 2021-22Mumbai: A miss out on in the
disinvestment target may cause the federal government's fiscal deficit to rise at Rs 16.6 lakh crore or 7.1 per cent of the GDP in the
existing financial year, score company ICRA stated in a report.With the state federal governments' financial deficit forecasted at a
reasonably modest 3.3 percent of GDP in 2021-22, the general government fiscal deficit is approximated at around 10.4 per cent of the GDP,
the company stated in a report.In the base case for 2022-23, the agency sees the federal government's financial deficit moderating to Rs
15.2 lakh crore or 5.8 percent of GDP.Although the planned ceasing of GST settlement might trigger the state governments' fiscal deficit to
rise to the cap of 3.5 percent of the GSDP set by the Fifteenth Financing Commission, the basic government deficit will still compress to
9.3 per cent of the GDP in 2022-23, it said.ICRA's primary economic expert Aditi Nayar said that with a palpable buoyancy in tax
collections, the federal government's gross tax invoices is expected to overshoot the allocated amount by a healthy Rs 2.5 lakh crore in
FY2022.However, the net tax profits gains to the government will be nullified by the expected large miss on receipts from disinvestment and
back-ended costs, specifically on those products that were included in the Second Supplementary Demand for Grants, such as food and
fertiliser subsidies, equity infusion into Air India Assets Holding Limited, and so on, she stated
Consequently, we expect the federal government's fiscal deficit to print at Rs 16.6 lakh crore in FY2022, exceeding the allocated amount of
Rs 15.1 lakh crore, Ms Nayar addd.Ms Nayar included that the union budget for 2022-23 will deal with some constraints, owing to an
anticipated slowdown in the growth in indirect taxes following the import tax relief offered recently, and the small amounts in small GDP
growth to around 12.5 percent from the 17.5 per cent anticipated in the current financial.