India's Fiscal Deficit At 26.8% Of FY27 Target By July As GDP Growth Accelerates

India’s fiscal deficit stood at 26.8% of the full-year target at the end of July, lower than the 29.9% recorded during the corresponding period of the previous financial year, according to Controller General of Accounts (CGA) data.

In absolute terms, the fiscal deficit was ₹4.55 lakh crore during April-July 2026.

The Centre has budgeted for a fiscal deficit of ₹16.96 lakh crore, equivalent to 4.3% of GDP, for FY27, as per a report by PTI.

The government’s total expenditure during the first four months of FY27 stood at ₹17.61 lakh crore, or 32.9% of the Budget Estimate, compared with 30.9% during the year-ago period, the CGA data showed.

Capital expenditure rose to ₹4.50 lakh crore from ₹3.50 lakh crore a year earlier, while revenue expenditure stood at ₹13.11 lakh crore. Interest payments were ₹4.26 lakh crore during the period.

Net tax revenue was ₹8.44 lakh crore, representing 29.5% of the Budget Estimate for FY27, compared with 23.3% during the corresponding period last year. Non-tax revenue stood at ₹4.23 lakh crore, or 63.5% of the annual estimate.

Q1 GDP Growth Accelerates To 7.8%

Separately, India’s economy grew 7.8% in the April-June quarter of FY27, accelerating from 6.9% in the same quarter a year earlier, according to data released by the Ministry of Statistics and Programme Implementation (MoSPI).

Real GDP at constant prices was estimated at ₹81.36 lakh crore in Q1 FY27, compared with ₹75.46 lakh crore a year earlier. MoSPI said the Indian economy has sustained growth momentum despite global headwinds.

Nominal GDP increased 10.3% to ₹88.27 lakh crore from ₹80 lakh crore in the year-ago quarter.

Real gross value added (GVA) grew 8.2% during the quarter to ₹73.82 lakh crore, compared with ₹68.21 lakh crore a year earlier. Nominal GVA rose 11.5% to ₹80.53 lakh crore.

Investment And Trade Indicators Remain Firm

The official GDP data also showed continued strength in several investment-linked indicators. IIP for capital goods grew 15.2% in Q1 FY27, compared with 8.8% a year earlier, while manufacture of electrical equipment expanded 27%.

Exports of goods and services increased 25.8% during the quarter, while imports rose 30.5%. Exports of transport goods climbed 52.2%, while imports of machinery and equipment increased 51.5%.

MoSPI cautioned that the GDP estimates are provisional and may undergo revisions as improved data coverage and revised inputs from source agencies become available.