India may allow its fiscal deficit to widen to 4.8% of GDP, up from the 4.3% target, as rising energy subsidies strain government finances due to the Iran war.
India widens fiscal deficit to 4.8% of GDP due to Iran war-driven energy costs; imports 90% of oil. Fiscal pressure could reduce government tech spending and VC funding in India—watch capex trends and regional hiring.
The deficit could increase to 4.8%
Jun 12, 2026
04:29 pm
What's the storyIndia is likely to allow a larger budget deficit this year, according to Bloomberg.
The decision comes as the ongoing war in Iran pushes up energy subsidy costs, putting further strain on government finances.
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India faces a larger budget deficit this year. The war in Iran is increasing energy subsidy costs. This puts pressure on…
India may widen its fiscal deficit to 4.8% of GDP due to rising fuel subsidies from the Iran war, marking its first deficit…
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