In an indication that the Narendra Modi-government is unlikely to crank up spending to revive the economy, chief economic adviser (CEA) Krishnamurthy Subramanian has said that gross market borrowings of the Centre may even dip below the budgeted level of Rs 12.05 lakh crore this fiscal.

While the CEA made these comments in an interview to a TV channel, data released by the Controller-General of Accounts (CGA) on Wednesday showed the fiscal deficit at Rs 1.23 lakh crore or 8.2 per cent of the budget estimate at end-May against around 58.6 per cent a year ago.

The central government on Wednesday also asked various ministries and departments to restrict expenses to a maximum of 20 per cent of their annual budgetary allocation in the September quarter. The restrictions for the second quarter would not be applicable for select ministries and departments, including health, agriculture, fertilisers, pharmaceuticals and food.

Subramanian’s comments also come just days after finance minister Nirmala Sitharaman announced a relief package that was dominated by guarantees.

Though the size of the stimulus measures was put at Rs 6.3 lakh crore, the actual fiscal hit would be much lower, economists said.

“The quantum of fresh measures comes to Rs 2.67 lakh crore. Since this package mostly consists of guaranteed loans (which do not result in immediate fiscal outgo), its actual impact on the fiscal in 2021-22 is estimated at just Rs 100 crore,’’ says Anagha Deodhar, research analyst at ICICI Securities.

Sitharaman had budgeted for a fiscal deficit of 6.8 per cent of GDP for this year, though many brokerages estimate it will higher. Due to the severe impact of the second Covid wave, there were suggestions that the government should spend its way out of the crisis.