What does deficit of GDP mean?

Fiscal deficit is usually mentioned in absolute terms or as a percentage of GDP. Fiscal deficit means the excess expenditure of the Government, it happens when the Government spends more than its earnings. You can read about the Fiscal Deficit – Meaning, Calculation, Components, Framework, and Differences with Revenue Deficit in the given link.

Reduced revenue earned by the Government or increased capital expenditure could be the reasons behind rise in Fiscal deficit.

Further readings:

  1. Difference between Economic Survey and Union Budget
  2. Previous Years Economics Mains Questions in UPSC Civil Service Exam, General Studies Paper – 3

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