Question

From the following data about a government budget, find out (a) Revenue deficit, (b) Fiscal deficit, and (c) Primary deficit.
`{:(, (Rs. " in arab")),((i) " Plan capital expenditure", " "120),((ii) " Revenue expenditure", " "100),((iii) " Non - plan capital expenditure", " "80),((iv) " Revenue expenditure", " "70),((v) " Capital receipts net of borrowing", " "140),((vi) " Interest payments", " "30):}`

Answer 1

(a) Revenue deficit = Revenue expenditure - Revenue receipts
= 100 - 70
= Rs. 30 arab
(b) Fiscal deficit = Plan Capital exp. + Non - plan Capital exp.
+ Revenue Capital exp. - Revenue receipts
- Capital receipts net of borrowing
= 120 + 80 + 100 - 70 - 140
= Rs. 90 arab
(c) Primary deficit = Fiscal deficit - interest payment
= 90 - 30
= Rs. 60 arab