India is likely to overshoot its fiscal deficit target for 2018/19 by a small margin following its decision to cut fuel excise duties, Moody’s Investors Service said on Tuesday, describing the move as “credit negative”.
The government announced cuts in excise duty on gasoline and diesel last week, to soften the impact of sharp rise in global crude oil prices on consumers.
The move came a few months before elections in three key states this year followed by national elections due by May.
