This is the third consecutive year that the government has revised its fiscal deficit target.
Reserve Bank of India (RBI) Governor Shaktikanta Das speaks during a press conference at the RBI head office in Mumbai on February 6, 2020. (Photo by Punit PARANJPE / AFP)
Reserve Bank of India (RBI) has no plans to monetise the rising fiscal deficit, said central bank Governor Shaktikanta Das on Thursday said during the post-policy conference.
This is the third consecutive year that the government has revised its fiscal deficit target.
The budget has pegged fiscal deficit at 3.8 per cent for the current fiscal year, up from 3.3 per cent projected in the previous budget; and at 3.5 per cent for FY21, up from 3 per cent estimated in the July 2019.
Advertisement
The government has already crossed the fiscal deficit at 132 per cent of the estimate as of December end.
The government has budgeted a net borrowing Rs 5.45 lakh crore from the market in FY21.
“There is no plan to monetise the government’s fiscal deficit,” Das told reporters during the post-policy conference.
The government has utilised ‘escape clause’ under the Fiscal Responsibility and Budget Management (FRBM) Act which provides it a 50 bps leeway for relaxation of fiscal deficit roadmap during time of stress.
(With input from agencies)
Advertisement
