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Budget 2010, FY11 fiscal deficit at 5.5%, FY12 seen at 4.8%
A revision in the base year for calculating gross domestic product (GDP) coupled with higher growth figures has allowed finance minister Pranab Mukherjee to present a lower fiscal deficit at 5.5 % per cent of FY11 GDP. The current year's deficit has been revised to 6.9%.
He also managed to peg the deficit much lower in the coming years.
-For FY12, it is 4.8%
-For FY13, it is 4.1%
Net borrowing for FY11 has been pegged at Rs 3.45 lakh crore.
It was not just the size of fiscal deficit — at 6.8% of the GDP — but the high probability of not being able to control it even over the next two years which was causing anxiety to economy watchers. At 6.8%, the government’s deficit roughly translated into Rs 400,000 crore of borrowing in FY 2009-10.
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