Jaitley’s budget for FY 18-19 slipped on Fiscal front

New Delhi: The Union Budget for Financial Year 2018-19 has focused on populism, but has slipped on fiscal front as Finance Minister Arun Jaitley failed to bring the fiscal deficit below 3.2 per cent which was the target in the last budget.
Though one can understand that this was the last full budget for the present Modi Government, and populist measures were expected in it, economist were of the opinion that Finance Minister will also emphasise on the fiscal discipline.
The Finance minster had taken credit of bringing fiscal deficit from 4.5 per cent to 3.5 per cent in last 4 years, but it is a fact that he missed his own target of bringing the fiscal deficit to 3.2 per cent in the current fiscal (2017-18).
Not only this, Finance Minster Jaitley projected fiscal deficit in the next financial year (2018-19) at the level of 3.3 of the GDP which is again more that what was projected for the current fiscal of 3.2 per cent of the GDP. In other words, not only he failed to keep the fiscal discipline this year, but also failed to manage it to bring it the level of FY 17-18 level.
In the budget, he proposed a slew of measures which include keeping the minimum support prices (MSP) of agricultural crops henceforth at least 1.5x of their production cost, allocation of Rs 20 billion for upgrading the existing rural ‘haats’ into Gramin Agricultural Markets, promoting cultivation of horticulture crops in clusters, launching of ‘Operation Green’ with a corpus of Rs 5 billion for cultivation of basic vegetables and allocation of Rs 100 billion for creating infrastructure for fisheries, aquaculture and animal husbandry etc.
In addition, the target of farm credit has been increased to Rs 11 trillion for FY19.