Find (a) fiscal deficit, and (b) primary deficit from the following:

Items (Rs in crore)

Revenue expenditure = 70,000

Borrowings = 15,000

Revenue receipts = 50,000

Interest payments = 25% of revenue deficit.

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Solution

Revenue Deficit = Revenue expenditue - Revenue receipts

= Rs. 70,000 crore - Rs. 50,000 crore

= Rs. 20,000 crore

Here, Interest payments = 25% of revenue deficit

Or, Interest payments $= \frac{25}{100} \times 20, 000$

= Rs. 5,000 crore

(a) Fiscal Deficit = Borrowings

= Rs. 15,000 crore

(b) Primary Deficit = Fiscal deficit - Interest payments

= Rs. 15,000 crore - Rs. 5,000 crore

= Rs. 10,000 crore

(a) Fiscal deficit = Rs. 15,000 crore

(b) Primary deficit = Rs. 10,000 crore

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Find (a) fiscal deficit, and (b) primary deficit from the following: Items (Rs in crore) Revenue expenditure = 70,000 Borrowings = 15,000 Revenue receipts = 50,000 Interest payments = 25% of revenue deficit.

Find (a) fiscal deficit, and (b) primary deficit from the following:

Items (Rs in crore)

Revenue expenditure = 70,000

Borrowings = 15,000

Revenue receipts = 50,000

Interest payments = 25% of revenue deficit.