Presenting the Union Budget 2026-27, Finance Minister Nirmal Sitharaman said the fiscal deficit for FY27 has been reduced to 4.3% of GDP, down from 4.4% in the revised estimates for FY26. She said the Centre has pursued fiscal consolidation consistently without compromising welfare spending, adding that it has “fulfilled the target of reducing the fiscal deficit to below 4.5%.”
The fiscal deficit represents the gap between the government’s total expenditure and its total revenue. A lower deficit indicates a tighter fiscal position.
The Centre has also accepted the recommendations of the 16th Finance Commission.
3 February 2026
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The Revised Estimates of the non-debt receits stands at ₹34 lakh crore, with the Centre's net tax reciepts at ₹26.7 lakh crore. The Revised Estimate of the total expenditure is ₹49.6 lakh crore, with ₹11 lakh crore constitutes capital expenditure.
Sitharaman said for FY27, the non-debt reciepts is expected to rise to ₹36.5 lakh crore while the total expenditure is estimated at ₹53.5 lakh crore. The net tax receipts of the Centre is projected to increase to ₹28.7 lakh crore.
To finance the fiscal deficit, the net market borrowings from dated securities are expected to be at ₹11.7 lakh crore, with remaining financing is expected to be recieved from small savings and other sources, Sitharaman said. The gross market borrowing is projected at ₹17.2 lakh crore.
