The fiscal deficit is also expected to be roughly 30bp higher than the budgeted level of 4.6% of GSDP in FY24.

As per the revised estimates (RE) for FY23, the state recorded a higher revenue deficit of Rs.61.70 billion (3.2% of GSDP) as against INR39.03 billion (2.0% of GSDP) in the budget estimate (BE) of FY23.

India Ratings and Research expects the revenue deficit of Himachal Pradesh to come in around 30bp higher than the budgeted 2.2% of the gross state domestic product (GSDP) in FY24. This being due to the optimistic assumptions regarding current expenditure and nominal GSDP growth in FY24 than budgeted. 

The fiscal deficit is also expected to be roughly 30bp higher than the budgeted level of 4.6% of GSDP in FY24. It will be more than the limits (3.0% of GSDP and additional 0.5% of GSDP subject to conditions) allowed by the union government. 

As per the revised estimates (RE) for FY23, the state recorded a higher revenue deficit of Rs.61.70 billion (3.2% of GSDP) as against INR39.03 billion (2.0% of GSDP) in the budget estimate (BE) of FY23. The higher revenue deficit resulted in a higher-than-budgeted fiscal deficit. While the fiscal deficit was budgeted at Rs. 96.02 billion (5.0% of GSDP), it came out to be much higher at INR124.83 billion (6.4% of GSDP, 18-year high) as per FY23 (RE). Ind-Ra had highlighted such an outcome; however, the quantum of increase came in higher than the agency’s expectations.