India’s central government may finish fiscal 2026-27 with a deficit about Rs1.2 trillion above its budget target, a reported SBI Research estimate that points to subsidy bills and lower fuel-tax receipts.
The Economic Times and Moneycontrol attributed the estimate to SBI Research; the bank’s public research archive did not list the underlying note. The government budgeted Rs16.96 trillion, so the reported overrun implies a deficit of about Rs18.16 trillion, rounded to Rs18.2 trillion. The reports did not present that rounded total as a separate forecast.
The Budget’s deficit target equals 4.3% of gross domestic product (GDP) using the 2011-12 GDP series. Reports put SBI Research’s projection at 4.7% using the 2022-23 series, which the Ministry of Statistics and Programme Implementation introduced in February 2026. The percentages use different GDP bases and are not directly comparable.
The Controller General of Accounts (CGA) recorded a provisional deficit of Rs7.14 trillion for April through September 2026, equal to 42.1% of the full-year estimate. At the same point in the previous fiscal year, the deficit stood at 36.5% of its annual target. The CGA says the midyear share may not track the final result because receipts and spending are uneven over the year.
The two outlets reported that SBI Research estimated fertiliser subsidies could exceed budget allocations by Rs900 billion and petroleum/LPG subsidies by about Rs480 billion. CGA accounts show fertiliser subsidies at about Rs1.19 trillion through September, up from Rs1.07 trillion a year earlier. Petroleum subsidies were Rs1,149 crore, down from Rs6,717 crore. Those official figures cover six months, while the research estimates concern the full year; the reports did not explain the difference in timing or scope.
The reports also said SBI Research believes government cash balances could cover the larger deficit without additional borrowing. Its proposals included an inflation-linked threshold for long-term capital-gains tax and preferential treatment for longer holding periods. The research estimated that a 50% increase in securities transaction tax could raise about Rs45,000 crore in FY28. These estimates and proposals were attributed to SBI Research by the two outlets; the bank’s public archive did not list the note.
The next indicator is the CGA’s October monthly accounts. Its calendar generally schedules monthly accounts for the last day of the following month, though dates can change.
