The recent surge in global debt has led to fresh fiscal constraints. Governments are now focusing on reducing their debt-to-GDP ratio. In India, the union budget has allocated funds to reduce the fiscal deficit.
The target is to bring it down to 4.5% by 2025. This move is expected to boost investor confidence and improve the overall economic health of the country. With a focus on fiscal consolidation, the government aims to promote sustainable growth and stability. As of now, the fiscal deficit stands at 6.4% of the GDP.
The government plans to achieve its target through a combination of revenue increase and expenditure reduction. This will have a positive impact on the economy in the long run.