Halfway through the financial year, the Central government’s fiscal deficit had improved to ₹4.74 lakh crore or 29.4% of its 2024-25 target, relative to the fiscal gap a year ago when it stood at ₹7 lakh crore or 39.3% of the 2023-24 Budget estimates.

However, worries emerged on whether the Centre is on track to meet this year’s ambitious capital spending target of ₹11.11 lakh crore, as fiscal numbers as of September 30 released by the Controller General of Accounts on Wednesday indicated a 15% decline in capex in the first half of the year compared to 2023-24.

Non-tax revenues were bolstered 51% aided by a hefty dividend from the Reserve Bank of India, and tax revenues were up 9%, while revenue expenditure grew just 4%.

ICRA chief economist Aditi Nayar noted that after the Q1 lull in capex due to the Lok Sabha polls, the Centre had sharply ramped up capex in July, but the momentum hasn’t sustained since then. The Centre now needs to spend about ₹1.16 lakh crore a month in the second half of the year to meet its target, 52% over last year’s levels, which appears “rather challenging at this juncture”, she reckoned. “We expect the capex target to be missed by a margin of at least ₹50,000 crore,” Ms. Nayar said.