Feb 2 (Reuters) – India’s annual federal budget shows a slowing pace of fiscal consolidation for the economy but is “broadly neutral” for growth in the world’s fifth largest economy, Fitch Ratings said on Monday.
“The slowing pace of consolidation seen in India’s budget for fiscal year 2027 is in line with our view that further progress on deficit reduction is becoming more difficult without compromising more on GDP growth,” Fitch said.
The government will target a debt-to-GDP ratio of 55.6% for 2026-27, resulting in a fiscal deficit of 4.3% of GDP, Finance Minister Nirmala Sitharaman said on Sunday in a budget that sought to strengthen the manufacturing sector amid a volatile global environment.
(Reporting by Kashish Tandon in Bengaluru; Editing by Sonali Paul)