Fiscal Deficit
The gap between the government's total expenditure and its total revenue excluding borrowings, in a year.
Formula
Fiscal Deficit = Total Expenditure - (Revenue Receipts + Non-Debt Capital Receipts)
Unit
%
In depth
The fiscal deficit is the amount the government must borrow in a year, so it drives the supply of government securities and therefore bond yields — a wider deficit means more paper and higher yields, all else equal. It is quoted as a percentage of GDP so it can be compared across years and countries, which means a nominal GDP shortfall widens the ratio even if spending was on plan. The quality matters as much as the level: borrowing to build infrastructure differs economically from borrowing to fund subsidies. India's fiscal responsibility framework targets a glide path down toward 4.5% of GDP.
Worked example
A deficit of ₹16.1 lakh crore against nominal GDP of ₹327 lakh crore is 4.9%. If nominal GDP comes in 2% below the estimate, the same borrowing becomes 5.0% of GDP with no additional spending.
Illustrative figures, chosen so the arithmetic is easy to follow. Not a live price and not a valuation of any company.
Educational reference only
This entry explains what “Fiscal Deficit” means. It is not investment advice and not a recommendation to buy or sell any security. Any numbers above are illustrative, not live prices, and nothing here predicts price direction or rates a stock. Consider your own circumstances and consult a SEBI-registered investment adviser before acting.