New Delhi, Feb 1 (.) union Finance Minister Nirmala Sitharaman on Sunday reaffirmed the government’s commitment to fiscal consolidation, pegging the fiscal deficit for 2026–27 at 4.3 percent of GDP while announcing gross market borrowings of Rs 17.2 lakh crore in the union Budget presented in Lok Sabha.
Presenting the Budget, Sitharaman said India’s public finances have been placed on a stable and credible path despite global uncertainties, supported by sustained economic growth, prudent expenditure management and higher capital investment. “Since we assumed office, the country’s economic trajectory has been marked by stability, fiscal discipline, sustained growth and moderate inflation. This is the result of conscious choices we have made even in times of uncertainty and disruptions,” she said.
The fiscal deficit target of 4.3 percent marks a further step in the government’s medium-term consolidation roadmap, even as it continues to prioritise public investment to support growth. Sitharaman underlined that fiscal prudence remains a cornerstone of economic policy. “We have pursued far-reaching structural reforms. Fiscal prudence and monetary stability, while maintaining a strong thrust on public investment, have been central to our approach,” she said.
The Finance Minister added that improved tax compliance, formalisation of the economy and rationalisation of expenditure have helped strengthen the government’s balance sheet without compromising developmental priorities.
Sitharaman announced that gross market borrowings for FY27 are estimated at Rs 17.2 lakh crore, a key figure closely tracked by bond markets and investors. The borrowing programme is intended to finance capital expenditure and priority sectors while ensuring orderly market conditions.
Officials indicated that the borrowing plan has been calibrated to avoid crowding out private investment, even as the government continues its focus on infrastructure-led growth.
Linking fiscal consolidation with growth, Sitharaman said the government’s emphasis on self-reliance and manufacturing has strengthened the economy’s fundamentals. “Keeping Aatmanirbharta as a lodestar, we have built domestic manufacturing capacity, energy security and reduced critical import dependencies,” she said.
She added that these measures, along with reforms in employment, agriculture and social services, have delivered around 7 percent GDP growth and contributed to a reduction in poverty. “Simultaneously, we have ensured that citizens benefit from every action of the Government,” the Finance Minister noted.
Economists said the 4.3 percent fiscal deficit target signals continuity in the government’s approach of balancing growth imperatives with macroeconomic stability. With global financial conditions remaining tight, the clarity on borrowing and deficit numbers is expected to provide reassurance to investors and rating agencies.
With the FY27 Budget, the government has sought to send a clear signal: India will continue to invest in growth and development while keeping public finances on a disciplined and sustainable path. . SKA .
