Centre on Track to Hit FY26 Fiscal Deficit Target of 4.4%, Says Economic Survey

• The Economic Survey 2025-26 states the Centre is on course to reduce its fiscal deficit to 4.4% of GDP by FY26.
• This achievement fulfills the commitment made in FY21 to halve the deficit ratio within five years, despite it not being a legislative target.
• Finance Minister Nirmala Sitharaman presented the survey in Parliament on January 29.
• The consolidation was achieved by improving the quality of fiscal expenditure, with an emphasis on capital expenditure, not just compression.
• Fiscal credibility has gained importance globally, and meeting the FY26 target signals disciplined fiscal management, leading to sovereign rating upgrades in FY26.

Why It Matters: The Centre is set to achieve its FY26 fiscal deficit target of 4.4%, demonstrating strong fiscal discipline and credibility.