Budget deficit puts Modi's pledge in doubt

Mumbai

INDIA'S budget deficit reached 99 per cent of the full-year target in just eight months, raising doubts that Prime Minister Narendra Modi can keep a pledge to narrow the gap to a seven-year low.

Failure to meet the goal for a shortfall of 4.1 per cent of gross domestic product would disappoint global investors who parked a record US$26.4 billion in local debt in 2014, according to PNB Gilts Ltd. Nomura Holdings Inc and IDBI Federal Life Insurance Co say fiscal indiscipline may hold up rate cuts by the Reserve Bank of India (RBI), which has been pressuring the government to play its role in fixing the economy.