Budget 2016: Fiscal Framework: Review medium-term fiscal stance

Fiscal hawks might not like it but the Budget 2016 has made a case for reviewing the medium-term fiscal framework in the upcoming Budget News. It, however, has argued that there were “good” arguments for both relaxing the fiscal deficit target and keeping it.

The framework mandates the government to cut its fiscal deficit to 3.5 per cent of the country’s gross domestic product (GDP) next financial year and 3 per cent by 2017-18 from the targeted 3.9 per cent in the current financial year.