"In the current fiscal, our capital expenditure, which goes into asset creation, has seen a significant growth as against revenue expenditure, which goes into salary payment and rent ... and is resulting in high growth," Finance Secretary Ratan P. Watal said on Saturday on the ministry's YouTube channel.
Noting that revenues being received are in tandem with expenditure the government is incurring, he said this meant that things were moving as planned. According to official data, plan expenditure during April to December was 74.4 percent of the budget estimates, as compared to 61.3 percent during the same period a year ago.
The government has targeted reducing the fiscal deficit to 3.9 percent of the gross domestic product (GDP) in the current financial year, from four percent last year, and reduce it further to 3.5 percent in 2016-17. The Indian economy grew 7.3 percent in the third quarter ended December 31, 2015, down from the 7.7 percent expansion in the previous quarter, but marginally up over 7.1 percent recorded in the like period of last fiscal, official data showed earlier this month.
The government's mid-year economic review, released December, lowered economic growth forecast for the current fiscal to the 7-7.5 percent range, from previously projected 8.1-8.5 percent, mainly because of lower agricultural output due to deficient rainfall.