New Delhi: Finance Minister Nirmala Sitharaman on Thursday said international rating agencies should take on board the message that India has bettered the targets set for lowering fiscal deficit. The government has announced a fiscal deficit of 5.1 per cent of GDP for 2024-25, lower than 5.8 per cent in the current fiscal.
As per the fiscal consolidation roadmap, the government aims to reduce the fiscal deficit to below 4.5 per cent by 2025-26 from 5.1 per cent of GDP in 2024-25. The government had estimated the fiscal deficit to come down to 5.4 per cent in the next financial year, beginning from April 1, 2024.
Replying to a question in the post-budget conference on her message to rating agencies, Sitharaman said: "Not only aligning with the fiscal consolidation roadmap that we gave earlier, but bettering it -- that is one simple, straight forward message that every rating agency should take on board."
Higher dividends from banks and financial institutions, apart from improvement in tax mobilisation, would help achieve the fiscal deficit glide path. All three global rating agencies -- Fitch, S&P and Moody's -- have the lowest investment grade rating on India, with a stable outlook. The ratings are looked at by investors as a barometer of the country's creditworthiness and impact borrowing of companies.
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