New Delhi: Finance Minister Nirmala Sitharaman said on Monday the fiscal deficit for FY21 has been pegged at 9.5 per cent of the GDP and will come down to 6.8 per cent in FY22.

The fiscal deficit will reach below 4.5 per cent by FY26, she said while presenting the Union Budget 2021-22. Sitharaman said while gross expenditure is seen at Rs 34.5 lakh crore, the capital expenditure is expected to be Rs 4.39 lakh crore in FY21.

The government will approach market for additional Rs 80,000 crore to fund the FY21 fiscal deficit, said the Finance Minister.

She said the FY22 gross expenditure is seen at Rs 34.83 lakh crore and capital expenditure at 5.54 lakh crore.

The market borrowing in FY22 is projected at Rs 12 lakh crore. The figures come amid coronavirus (Covid-19) pandemic which has led to massive economic disruption within and outside the country.