Union Finance Minister Nirmala Sitharaman upon her arrival at the Parliament House complex to present the ‘Union Budget 2025-26.
Credit: PTI photo
New Delhi: Total expenditure of the central government is estimated to cross Rs 50 lakh crore for the first time in the financial year 2025-26, out of which Rs 11.21 lakh crore will be on the development of infrastructure and long-term assets creation, as per the Union Budget 2025-26 presented on Saturday.
In her eighth consecutive budget, Finance Minister Nirmala Sitharaman proposed to increase the total expenditure to Rs 50.65 lakh crore in 2025-26 from the revised estimate of Rs 47.16 lakh crore for the current financial year. The total expenditure estimate has been revised down from Rs 48.20 lakh crore. In 2023-24, the total expenditure of the central government stood at Rs 44.43 lakh crore.
The government’s capital expenditure in the current financial year is likely to fall short by nearly Rs 1 lakh crore. The capex for 2024-25 has been revised downward to Rs 10.18 lakh crore from the estimate of Rs 11.11 lakh crore announced in July.
For the financial year beginning April 2025, the capex has been pegged at Rs 11.21 lakh crore, which is 3.1 per cent of the country’s gross domestic product (GDP).
Capex includes investment on development of infrastructure and creation of long-term assets. In 2023-24, the capex stood at Rs 9.49 lakh crore.
The central government’s capex for 2025-26 will include capital support to states through interest-free long-term loans with an outlay of Rs 1.50 lakh crore.
While the government raises money through taxes and other sources to fund the expenditure, a substantial amount of money is borrowed from the markets.
The difference between total expenditure and total receipts, excluding debt capital receipts, is referred to as fiscal deficit.
Sitharaman has proposed to bring down the fiscal deficit for FY26 to 4.4 per cent of the GDP from the revised estimate of 4.8 per cent in the current financial year.
In absolute terms, the fiscal deficit is estimated to come down marginally from the revised estimate of Rs 15.69 lakh crore in the current fiscal to Rs 15.68 lakh crore in FY26. In 2023-24, it stood at Rs 16.54 lakh crore or 5.6 per cent of the GDP.
Total receipts other than borrowings in 2025-26 is estimated at Rs 34.96 lakh crore. This includes net tax receipts of Rs 28.37 lakh crore.
To finance the fiscal deficit, the government will borrow Rs 11.54 lakh crore from the markets and through dated securities. “The balance financing is expected to come from small savings and other sources. The gross market borrowings are estimated at Rs 14.82 lakh crore,” Sitharaman said.
The revenue from income tax is estimated to rise to Rs 14.38 lakh crore in FY26 from the revised estimate of Rs 12.57 lakh crore in the current year.
Union Budget 2025 | Nirmala Sitharaman, as Finance Minister, presented her record 8th Union Budget this time. While inflation has burnt a hole in the pockets of 'aam janata', the Modi govt gave income tax relief for those making up to Rs 12 lakh per year in salaried income. Track the latest coverage, live news, in-depth opinions, and analysis only on Deccan Herald. Also follow us on WhatsApp, LinkedIn, X, Facebook, YouTube, and Instagram.