SOURCE : NEW18 NEWS
Last Updated:April 21, 2025, 10:01 IST
Finance Minister Nirmala Sitharaman, in San Francisco, reaffirmed India’s goal to cut its fiscal deficit below 4.5% by 2026.
FM Nirmala Sitharaman on five-day visit to the US. (Image Courtesy: Nirmala Sitharaman Office X Handle)
India Fiscal Deficit: During an interaction with the Indian diaspora in San Francisco, USA, Finance Minister Nirmala Sitharaman reaffirmed India’s goal of reducing its fiscal deficit to below 4.5% by 2026. The FM explained that they are committed to bringing down fiscal deficit with year-on-year targets.
“During the COVID-19 pandemic, our fiscal deficit went up. But in 2021, we came up with a clear signal as to how we wanted to manage our fiscal deficit. We set year-on-year targets and committed to bringing the fiscal deficit below 4.5% by 2026. And that’s what we have been following each year without fail,” Sitharaman stated during the interaction.
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She further added that the International Monetary Fund (IMF) and World Bank are acknowledging the vast potential that India possesses.
“When we say that India is the fastest-growing economy and when IMF or World Bank recognise that India can be the engine driving global trade, what they are recognising is the immense potential that exists in India,” Sitharaman said.
A lower fiscal deficit instils confidence among foreign investors due to prudent governance of finances and improves the likelihood of a sovereign rating upgrade.
India’s budget deficit has steadily decreased from a high of over 9% in 2020-21.
During the Covid-19 pandemic, our fiscal deficit went up. But in 2021, we came up with a clear signal as to how we wanted to manage our fiscal deficit. We set year-on-year targets and committed to bringing the fiscal deficit below 4.5% by 2026. And that’s what we have been… pic.twitter.com/ykq9ci7QtA— Nirmala Sitharaman Office (@nsitharamanoffc) April 21, 2025
The revised estimate for fiscal deficit for 2024-25 was 4.8 per cent, down from 5.6 per cent in 2023-24 and 6.4 per cent in 2022-23.
Sitharaman is on a five-day visit to the United States. Her itinerary includes a keynote address at Stanford University and discussions with CEOs in San Francisco, focusing on investment and technological advancements. She will also attend diaspora events to strengthen India’s global cultural presence.
In Washington DC, Sitharaman will participate in several high-level meetings, including the IMF and World Bank Spring Meetings and the G20 Finance Ministers and Central Bank Governors Meetings. Additionally, she will hold bilateral discussions with counterparts from various countries, underscoring India’s dedication to international cooperation and development.
