India’s fiscal deficit has been a pressing concern. The government aims to reduce it to 4.5% of GDP by 2025. Implementing strategies like reducing subsidies and increasing tax revenues can help achieve this goal.
For instance, the GST reforms have shown promise, with a 10% increase in tax collection. However, the government must also focus on reducing borrowings and debt. A 5% reduction in borrowing can lead to a 1% decrease in fiscal deficit. With the right strategies, India can achieve its fiscal deficit targets and promote economic growth.