7th Pay Commission Latest News: The data released by the Controller General of Accounts (CGA) on the current fiscal deficit can adversely affect the hopes of Central government employees who have been demanding hike in their minimum pay and fitment factor beyond 7th Pay Commission recommendations.Also Read - Government On Course With Privatisation Of Two Public Sector Banks: Report

The CG employees are not satisfied with the recommendations of the 7th Pay Commission recommendations regarding the minimum pay and have been demanding, for a long time, a hike of Rs 8000 and an increase in the fitment factor up to 3.68 times. Also Read - 7th Pay Commission Latest News Today: Big Announcement on Fitment Factor Hike For Govt Employees Likely Today | Deets Inside 

The fiscal deficit has already touched 52 per cent of the government’s budget estimate in the first two months of 2019-20 and it can be a hindrance in the demands of CG employees who were unsatisfied with the recommendations of the 7th Pay Commission recommendations regarding the minimum pay and fitment factor. Also Read - Good News For Pensioners: Centre Announces Hike in Dearness Relief For This Category of Retired Employees

Finance Minister Nirmala Sitharaman has been holding pre-budget meetings with all the stakeholders and currently facing the challenge to contain fiscal deficit to elevated levels of 3.4 per cent of GDP (gross domestic product) in FY20.

Any decision to fulfil the demands of Central Government employees can damage the fiscal consolidation plan of the Modi government.

During the interim budget, in February, the government had estimated Rs. 7.03 lakh crore as the fiscal deficit for the current financial year.

In absolute terms, the gap between expenditure and revenue, stood at Rs 3,66,157 crore, as per the data released by the CGA.

But the recent cut in the repo rate can also affect the government’s policy and try to infuse more capital in the market for a growth surge.

The first Budget of Modi 2.0 government is scheduled to be presented on July 5 by Nirmala Sitharaman on the backdrop of India’s economy hitting 5-year low growth of 6.8 per cent in 2018-19.

Government employees are also expecting an increase in their dearness allowances (DA) by four per cent in July 2019 to reach up to 16 per cent. If the allowance hike is implemented, it will be the biggest increase in the DA since the implementation of the 7th pay scale in 2016.