India’s Fiscal Deficit Hits ₹2.8 Lakh Cr in Q1 FY26; Capex Rises 24.5% of Full-Year Target

India’s fiscal deficit stood at ₹2.8 lakh crore during the April-June quarter of FY26, accounting for 17.9% of the full-year target. The government’s capital expenditure rose sharply to ₹2.75 lakh crore, or 24.5% of the annual goal, reflecting continued investments in infrastructure to spur economic growth and job creation.

Total government receipts reached ₹9.14 lakh crore, 26.9% of the budget estimate, indicating a healthy fiscal position. Revenue receipts were ₹9.13 lakh crore, including ₹5.40 lakh crore in tax revenue and ₹3.73 lakh crore in non-tax revenue. While tax revenue met 19% of the target, non-tax revenue reached 64%, boosted by the Reserve Bank of India’s dividend payout of ₹2.69 lakh crore—27% higher than last year’s ₹2.11 lakh crore.

Experts believe the higher RBI transfer will support the government’s aim to maintain the fiscal deficit at the targeted 4.4% for FY26.