Govt Reports Fiscal Surplus In May 2025, RBI Dividend Boosts Revenues

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Posted by AI on 2025-06-30 18:50:29 | Last Updated by AI on 2025-06-30 17:41:55

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India started the fiscal year 2025 with a strong surplus in April and May, a trend attributed to robust revenue generation and clever budgeting, boosting hopes of a fiscal deficit target beating. For the two months, the fiscal deficit stood at Rs 13,163 crore, equivalent to 0.8% of the full-year target. This signals a promising start to the fiscal year.

The robust revenue position was supported by a healthy dividend from the Reserve Bank of India (RBI), which contributed Rs 10,000 crore to the exchequer. The central government's revenue expenditure increased by 11% compared to the same period last year. This was driven primarily by a 39% increase in capital expenditure, underscoring the government's commitment to investing in infrastructure and economic growth.

The Finance Ministry, in its Monthly Economic Review for April, stated that the healthy start to the fiscal year 2025 could be further strengthened by accelerating GDP growth and ensuring that the revenue department collects taxes efficiently. The report also highlighted ongoing concerns about the uncertain global economic outlook and the potential impact of the global commodity price surge on India's imports and inflation.

Ultimately, the strong start to the fiscal year, coupled with intelligent budgeting and economic initiatives, bodes well for India's economic prospects and its ability to withstand potential challenges on the horizon.

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