The Indian government’s recent efforts to curb fiscal deficit have shown promise, with a reduction of 0.4% in the last fiscal year. Experts attribute this to stringent budget allocations and increased taxation on luxury goods. However, more needs to be done to achieve the target of 3.5% by 2025. Implementing policies like reducing subsidies on non-essential items and encouraging public-private partnerships can help.
For instance, the government can learn from the Maharashtra state model, which has successfully reduced its fiscal deficit by 1.2% through such measures. With a focus on sustainable fiscal management, India can achieve economic stability and growth.