CSEET · Economic and Business Environment · Indian Union Budget
In a year, the Union Government's fiscal deficit is Rs 16,00,000 crore and its interest payments are Rs 11,00,000 crore. What is the primary deficit?
The primary deficit is Rs 5,00,000 crore. It is found by subtracting interest payments of Rs 11,00,000 crore from the fiscal deficit of Rs 16,00,000 crore, showing borrowing needed for expenditure other than interest on past debt.
- ARs 27,00,000 crore
- BRs 5,00,000 croreCorrect
- CRs 11,00,000 crore
- DRs 16,00,000 crore
Explanation
Primary deficit = fiscal deficit minus interest payments = 16,00,000 - 11,00,000 = Rs 5,00,000 crore. Adding the two figures (Rs 27,00,000 crore) is the sign error. Check: 5,00,000 + 11,00,000 = 16,00,000, which reconciles.
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