India May Cut Budget Gap Target Slightly After Cash Boost
- Fiscal deficit likely to be reduced to 5% of GDP or even lower
- There’s room to meet financial demands of allies: officials
Narendra Modi returned to power only with the support of coalition partners.
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Prime Minister Narendra Modi’s government will likely reduce its fiscal deficit target slightly, according to people familiar with the matter, signaling an intent to keep a grip on finances as speculation grows about increasing demands from allies.
The gap for the year through March 2025 could be 5% of gross domestic product or even lower, the people said, compared with the 5.1% target set before the national elections. A final decision is expected to be taken in the coming days before Finance Minister Nirmala Sitharaman gives her budget speech on July 23, they said.