FM Sitharaman says Rs 1 lakh crore stabilisation fund will help govt face global headwinds

The Centre is setting up a Rs 1 lakh crore Economic Stabilisation Fund to strengthen its ability to manage external disruptions and maintain fiscal stability, finance minister Nirmala Sitharaman said on Friday.Intervening in the Lok Sabha during the debate on the second batch of supplementary demands for grants, she said the proposed fund is designed to function as a fiscal buffer in times of global uncertainty, including the present tensions in West Asia. “The Rs 1 lakh crore Economic Stabilisation Fund will give fiscal headroom to allow India to respond to global headwinds,” Sitharaman said, quoted PTI.The government has sought Parliament’s approval for additional gross expenditure of Rs 2.81 lakh crore for the ongoing financial year. With additional receipts of Rs 80,000 crore factored in, the net incremental cash spending is pegged at Rs 2.01 lakh crore.Sitharaman said the fiscal deficit for 2025-26 will stay within the Revised Estimates and remain aligned with the Budget projection of 4.4 per cent of GDP. She emphasised that the latest supplementary demands do not push total expenditure beyond the Budget Estimates for the year. “There is no increase in expenditure beyond the BE of 2025-26 due to the second supplementary,” she said, amid Opposition protests over concerns related to LPG availability.In the Revised Estimates, overall government spending for the current fiscal was scaled down to Rs 49.65 lakh crore from Rs 50.65 lakh crore indicated in the Budget. Data from the Controller General of Accounts shows that Rs 36.90 lakh crore had been spent up to January.Apart from the stabilisation fund, the supplementary demands include additional allocations of Rs 19,230 crore for fertiliser subsidy and Rs 23,641 crore under the Pradhan Mantri Garib Kalyan Anna Yojana. The government has also sought Rs 41,822 crore more for the defence ministry.The finance minister said sufficient financial provisions have been made to ensure fertiliser availability for farmers and asserted that there will be no shortage.