Question

Calculate Revenue Deficit, Fiscal Deficit and Primary Deficit from the following data:

Items (Rs in crore)

(i) Revenue expenditure 22,250

(ii) Capital expenditure 28,000

(iii) Revenue receipts 17,750

(iv) Capital receipts (net of borrowing) 20,000

(v) Interest payments 5,000

(vi) Borrowings 12,500

Answer 1

1. Revenue Deficit = Revenue expenditure - Revenue receipts

= Rs. 22,250 crore - Rs. 17,750 crore

= Rs. 4,500 crore

2. Fiscal deficit = Revenue expenditure + Capital expenditure - Revenue receipts - Capital receipts (net of borrowings) = Borrowings = Rs. 12,500 crore

3. Primary Deficit = Fiscal deficit - Interest payments

= Rs. 12,500 crore - Rs. 5,000 crore

= Rs. 7,500 crore

Revenue deficit = Rs. 4,500 crore

Fiscal deficit = Rs. 12,500 crore

Primary deficit = Rs. 7,500 crore