Govt Utilizing Borrowed Resources for Capital Expenditure as Fiscal Deficit Stands at 4.4% of GDP: FM Sitharaman

Finance Minister Nirmala Sitharaman has asserted that the government is focusing on bringing prosperity to the villages along with making agriculture, MSMEs, investment, and exports the growth engines. She said that in the Union Budget 2025-26, the emphasis has been laid on increasing agricultural production in the 100 most backward districts in the country.

The minister stated this while replying to the discussion on the Union Budget in the Lok Sabha last evening. She said that the effective capital expenditure is 4.3 percent, and the fiscal deficit is 4.4 percent of the GDP, indicating that the government is using all borrowed resources for financing effective capital expenditure and creating capital assets. She added that the Union Budget 2025-26 balances national development necessities with fiscal priorities. She said that the General Budget 2025-26 has come at a time of immense uncertainties and changes in the global macroeconomic environment. Ms. Sitharaman said India continues to be the fastest-growing economy.

The minister said a major step has been taken to improve operational efficiency in ministries. She said the ministries are more empowered now, so decisions regarding the dispersal of money are quicker. Ms. Sitharaman highlighted the sectoral outlays for different ministries, saying agriculture has received 1.71 lakh crore rupees, rural development 2.67 lakh crore rupees, and defense (excluding defense pensions) gets 4.92 lakh crore rupees.

She highlighted that money is not being denied to any of the capital expenditure accounts. The minister also clarified that there is no reduction of funds to the Ministry of Minority Affairs. She said that subsidies for food, petroleum, and fertilisers have been increased in the Union Budget 2025-26.

Talking about inflation, she said that, unlike the UPA regime when there was double-digit inflation, the current government has kept it under control. Ms. Sitharaman said that before 2014, 45 percent of households did not have LPG connections or clean fuel. She observed that now clean cooking fuel is available to about 32 crore households, which is almost 100 percent of households. Ms. Sitharaman said that more than 10.3 crore beneficiaries are getting LPG cylinders for 503 rupees. She said various global and domestic factors influenced the value of the rupee against the US dollar. Referring to BSNL, the finance minister asserted that the government has strengthened the public sector undertaking through several packages.

Rejecting the allegations of TMC MPs that the interests of West Bengal have not been taken care of in the Union Budget, the minister listed out several allocations and steps made in the budget for the state. She said a record railway budgetary allocation has been made for West Bengal.



Ms. Sitharaman talked about initiatives in civil aviation, metro, and other sectors for the state. She alleged irregularities in different central schemes in the TMC-ruled West Bengal.

Earlier, participating in the discussion, Akhilesh Yadav of the Samajwadi Party alleged that the fruits of welfare schemes are not reaching the people at the ground level. He said that the government has no roadmap for Viksit Bharat and for doubling the income of farmers. He said the budget has only focused on the rich and industrialists. Mr. Yadav said people in the country are facing hardship in managing their daily needs. He said the government should look into the volatility in the stock market.

The Samajwadi Party MP criticised the government over the reported traffic jam situation in Prayagraj during the Maha Kumbh Mela. Saleng Sangma of Congress raised the issue of the deportation of Indians from the US and questioned the government over the issue. He criticized the Union Budget, saying it has failed to address the key problems in the country, including in the fields of agriculture, education, and urban development. He alleged that the funds for the matriculation scholarship for minorities have been reduced. Another Congress MP, Prabha Mallikarjun, also spoke on the budget and questioned it. Hanuman Beniwal of RLP talked about the problems of farmers in the country and demanded a legal guarantee for the Minimum Support Price on farm produce.

Taking part in the discussion, Hema Malini of the BJP said the country is witnessing speedy development with a focus on women and farmers. She said schools in rural areas are flourishing, and health facilities are being improved. She also lauded the government for taking a decision to provide tax relief from income tax up to the income of 12 lakh rupees. She stressed that this budget will give pace to the Viksit Bharat vision.

Another BJP MP, Jagdambika Pal, said that the revenue deficit and fiscal deficits have been kept under control. He said the budget has made proper allocations for the states, including West Bengal, Punjab, and Kerala.

Shrikant Shinde of Shiv Sena underlined the initiatives taken in the budget for farmers, laborers, youth, and the middle class. He asserted that the Union Budget has taken care of the interests of every section of society.

The Shiv Sena MP said that the Narendra Modi government is known for welfare schemes, while the previous UPA regime is known for scams. Phani Bhusan Choudhury of AGP, Independent MPs Rajesh Ranjan alias Pappu Yadav, Vishal Prakashbapu Patil, Umeshbhai Patel, and several other members also spoke during the discussion. Lok Sabha adjourned to meet again on 13 February, 2025, at 11:00 A.M.