New Delhi, Nov. 11 -- The Central government's finances have weakened in the first half of the current financial year (H1 FY27) compared with a year ago, but the fiscal deficit levels remain within manageable limits and are not as bad as previously expected. However, the second half could be more challenging as the dividend cushion fades, and the government faces a higher revenue and expenditure run rate to meet its full-year Budget targets.

In H1 FY27, the government's fiscal deficit stood at 42.1% of the budget estimates, higher than 36.5% in the same period last year. However, despite the worsening, it remained at the halfway mark of 50%. This was achieved without compromising on capital expenditure commitments, which stood at 53.6% o...