Finance minister tables the second batch of supplementary demands for 2025–26 in Lok Sabha, saying additional spending will not breach the fiscal deficit target.
Union Finance Minister Nirmala Sitharaman on Friday presented the second batch of Supplementary Demands for Grants for 2025–26 in the Lok Sabha, proposing a gross additional expenditure of about ₹2.81 lakh crore to strengthen defence, support rural employment and create a fiscal buffer to manage global economic uncertainties.
The proposal includes provisions through cash, technical and token supplementaries and is aimed at addressing emerging expenditure requirements while maintaining fiscal discipline.
Responding to the discussion on the grants in the House, Sitharaman said the proposed supplementary demands involve a gross expenditure of approximately ₹2.81 lakh crore.
“This involves gross expenditure of about ₹2.81 lakh crore through cash or technical or token supplementaries. The present proposal also includes an amount of ₹902 crore that is being provided for recouping advances of an equivalent amount from the Contingency Fund of India,” the finance minister said.
The additional allocations are expected to support key sectors including national defence and rural employment programmes, while also providing financial flexibility to respond to evolving global economic challenges.
Sitharaman emphasised that the introduction of supplementary demands should not be interpreted as a sign of poor budgeting but rather as an indication of responsive and flexible governance.
She noted that the government has deliberately restricted supplementary demands to a “bare minimum” and typically introduces them only twice during a financial year to accommodate unavoidable spending needs.
The finance minister also assured the House that the proposed additional expenditure would not compromise the government’s fiscal discipline or breach the fiscal deficit target outlined in the Union Budget.
“We will, in no way, fail to fulfil the commitment made in the Budget. I would like to reiterate that the assurances given in this House will remain within the fiscal deficit target that was presented in Parliament on February 1, 2026,” Sitharaman said.
Defending the creation of a fiscal cushion, Sitharaman highlighted the government’s decision to establish a ₹50,000 crore fiscal buffer or equalisation fund to deal with potential economic shocks.
She argued that such a buffer is necessary in an increasingly uncertain global economic environment marked by supply chain disruptions and geopolitical tensions.
“Are the Opposition members suggesting that in times of unforeseen challenges, should the government not create a fiscal buffer or equalisation fund of ₹50,000 crore?” she asked.
According to Sitharaman, the fund will provide the government with the necessary fiscal headroom to respond quickly to global economic volatility, including disruptions to trade, supply chains, and commodity markets.
The supplementary demands will now be taken up for approval by Parliament as part of the government’s mid-year fiscal adjustments for the ongoing financial year.
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