revenue defict is estimated to be 20,000 crores, and borrowing is estimated to be 15,000 crores. if expenditure on interest payment is estimated to be 50% of the revenue deficit. find deficit and primary deficit
Answers
Answer:
Particulars (₹in crores)
Fiscal Deficit
Revenue Deficit
Primary Deficit
Revenue Receipts
Non- debt Capital Receipts
12,000
9,000
5,000
6,000
10,000
Solution:
(a) Fiscal deficit= Revenue deficit + (Capital expenditure – Non-debt creating capital receipts)
₹12,000 crores= ₹9,000 + Capital expenditure- ₹10,000)
Capital expenditure= ₹12,000 crores – ₹9,000 crores + 10,000 crores
= ₹13,000 crores
(b) Total expenditure = Revenue expenditure + Capital expenditure
Revenue expenditure = Revenue defici + Revenue receipt
= ₹9,000 crores + ₹6,000 crores
= ₹15,000 crores
Total expenditure = Revenue expenditure + Capital expenditure
=₹15,000 crores + ₹13,000 crores
= ₹28,000 crores
(c) Primary deficit = Fiscal deficit – Interest payments
₹5,000 crores = ₹12,000 crores – Interest Payments
Interest Payments = ₹12,000 crores – ₹5,000 crores
= ₹7,000 crores