JAKARTA, Dec : Indonesia’s 2007 budget deficit is estimated at 1.2 per cent of gross domestic product, smaller than expected, despite high oil subsidies from soaring oil prices, Finance Minister Sri Mulyani Indrawati said on Saturday.

The budget deficit is estimated at 1.2 per cent because we have achieved our revenue target, particularly revenue from tax, as stated in the revised state budget, Indrawati told reporters.

Indrawati said the growth in revenue and grants, estimated to be higher than the growth of expenditures, helped set the estimated deficit figure, which equals to 46.9 trillion rupiah (about $5 billion).

Indonesia’s 2007 revenue and grants are estimated at 19.2 per cent of the GDP, or 724.2 trillion rupiah, 4.3 per cent higher than the 694.1 trillion rupiah target stated in the revised state budget, a finance ministry document showed.

Indrawati said a rise in total exports also contributed to the higher revenue, led by stronger global demand for commodities such as minerals and palm oil.

The ministry document estimated the total expenditure to be at 20.4 per cent of GDP, or 771.1 trillion rupiah, higher than the 752.4 trillion rupiah target stated in the revised state budget, driven by higher oil subsidies due to rising global prices.

There had been worries that soaring oil prices would sharply raise fuel subsidies in the budget and push up the deficit.---Reuters