Government Seeks Parliament Approval to Spend Net Additional ₹415 Billion in FY26

The government has sought Parliament’s approval to spend a net additional ₹415 billion in the current financial year ending March, primarily due to higher fertiliser and petroleum subsidies. 

Although the total amount in the first Supplementary Demands for Grants for 2025-26 is ₹1.32 trillion, the cash outgo will be only ₹415 billion, as the rest consists of technical proposals that will be matched by savings or enhanced receipts of ministries.

Of the additional spending proposals, ₹185 billion is for fertiliser subsidies and ₹95 billion on petroleum subsidies to compensate public sector oil marketing companies for losses on the sale of domestic cooking gas.

The additional cash outgo of ₹415 billion is unlikely to exert significant pressure on the government’s fiscal position. The cash outgo this year is lower than ₹441 billion in the first supplementary last year and ₹584 billion the year before.

The Budget has projected total government expenditure in 2025-26 to rise 8.8% to ₹50.65 trillion. In April-October, expenditure rose 6.1% to ₹26.26 trillion.

The central government’s fiscal deficit at the end of October was ₹8.25 trillion, or 52.6% of the full-year target and was 9.9% higher year-on-year. The Budget has projected the fiscal deficit in 2025-26 to decline 0.5% to ₹15.69 trillion.