The central government’s fiscal deficit stood at ₹12.52 lakh crore at the end of February, or 80.4% of the full-year Budget Estimate for 2025–26, lower than 85.8% in the corresponding period last year, according to official data released on Monday. 

The government has pegged the fiscal deficit for FY26 at ₹15.58 lakh crore, or 4.4% of GDP. 

Receipts, spending track estimates 

As per the monthly accounts, total receipts during April–February stood at ₹27.92 lakh crore, accounting for 82% of the revised estimates (RE) for FY26. This included ₹21.45 lakh crore in net tax revenue, ₹5.81 lakh crore in non-tax revenue, and ₹65,547 crore in non-debt capital receipts. 

Transfers to states rose significantly to ₹12.66 lakh crore, up by ₹85,837 crore from a year ago. 

Total expenditure during the period was ₹40.45 lakh crore, or 81.5% of the FY26 RE. Of this, revenue expenditure stood at ₹31.15 lakh crore, while capital expenditure was ₹9.29 lakh crore, underscoring the government’s continued focus on infrastructure-led growth. 

Interest payments accounted for over ₹10.65 lakh crore, while major subsidies were at ₹3.90 lakh crore. 

Mixed revenue trends; capex remains robust 

Devendra Pant, Chief Economist at India Ratings and Research, said the April–February fiscal data reflects mixed trends. 

“Net tax revenue growth is lagging the revised estimate target while non-tax revenues appear on track. Non-debt capital receipts have already exceeded the full-year target,” he said. 

Pant noted that higher devolution to states, which grew 19%, weighed on net tax revenue growth in February. Additionally, central GST growth slowed to a three-month low of 5.9%. 

At the same time, revenue expenditure growth remained subdued at 1.1% year-on-year, helping contain the fiscal deficit. In contrast, capital expenditure grew a strong 14.5% during the period, indicating a shift towards more productive spending. 

Despite slower nominal GDP growth, Pant expects the government to meet its FY26 fiscal deficit target, supported by spending discipline and improved quality of expenditure. 

Overall, the data points to a gradual improvement in the composition of government spending, with a greater emphasis on capital creation even as revenue-side pressures persist.