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Latest revenue as well as expenditure figures point towards a lower than estimated fiscal deficit for FY21, said the SBI Ecowrap report.

As per the report, the latest revenue and expenditure numbers could lead to lowering of fiscal deficit to 8.7 per cent of GDP from 9.5 per cent as per revised BE in FY21 budget.

"If this is so, it is highly likely that the government might cancel its borrowing planned in the last 2 weeks of Mar'21, totalling Rs 49,000 crore," the report said.

"This in turn might lead to lowering of 10 year G-sec yield by end-March. And the better than expected revenue position could be a leverage for tax rationalisation on petroleum products too in the coming days."

Separately, the report proposed an increased and graded subsidy may be provided to "poor consumers" for LPG cylinders, which can be tapered off over a time period.

"For this, the government can create a comprehensive merged database using databases of Ayushman Bharat, PM-KISAN, PMJDY, PMUY and MUDRA and then provide these people with maximum four free cylinders in a year."

"Even if 5 crore people are eligible for this then the total cost to exchequer per year will be maximum Rs 16,000 crore."