1 hr ago

India Begins FY28 Budget Planning Amid Subsidy and Deficit Pressures

India has started planning its government budget for the year after FY27.

The Finance Ministry asked government departments to estimate their spending more carefully.

This is meant to reduce the need to move money between programmes during the year.

Meetings with farmers, businesses and social-sector groups will begin on October 12, 2026.

A conflict in West Asia has raised the prices of some important goods, including fertiliser and fuel.

That could make government subsidies more expensive.

The government has already spent a large share of its planned infrastructure budget in the first three months of FY27.

An economist expects the next budget to be somewhat larger while the deficit declines only gradually.

Key facts

FY27 capital expenditure budget: Rs 12.21 trillion; 28% was spent in the first three months, compared with about 24.5% a year earlier.
FY27 total receipts: About Rs 36.5 trillion budgeted; nearly 29% was received in the first three months.
FY27 total expenditure: About Rs 53.4 trillion in the Controller General of Accounts data; roughly 25.4% was spent in the first three months.
Fertiliser subsidy: More than half of the Rs 1.70 trillion FY27 budget had reportedly been used.
Food subsidy: The bill could exceed the Rs 2.28 trillion FY27 estimate and reach about Rs 2.5 trillion.
FY28 Budget outlook: Madan Sabnavis expects the overall Budget size and capital expenditure to rise by about 4-5%.
Fiscal deficit outlook: The deficit could decline from about 4.3% toward 4%, according to Sabnavis; the article also cites total FY27 spending as Rs 53.5 trillion elsewhere.

rediff.com · 5 hrs ago