The government achieved 16 per cent of its fiscal deficit projection for the current fiscal in the month of April alone. This has dampened expectations for further rate cuts as the government may step up its market borrowings. The deficit comes on the back of poor excise duty collections, the rate of which was cut as a part of the three stimulus packages announced between December and February to spur a slowing economy.

Fiscal deficit in absolute numbers stood at Rs 54,100 crore in April this year, which is 16.3 per cent of the targeted Rs 3,32,835 crore for the entire fiscal. Fiscal deficit was projected to be 5.5 per cent of the GDP in the interim Budget for 2009-10.

The government had cut excise duty rates by 6 per cent, as a result of which net collections turned negative at Rs 78 crore in April 2009, according to figures released by the Controller General of Accounts. Excise mop-up turning negative means that refunds were more than collections.

Of various levies imposed by the Centre, only income tax collections showed growth. In April 2009 against a year ago, income tax collections stood at Rs 9,489 crore clocking 20 per cent growth. Income tax collections in April 2008 stood at Rs 7,905 crore. However, service tax collections were marginally lower at Rs 2,270 crore against Rs 2,271 crore.