Question
Which of the following statements is/are correct with reference to Primary deficit?
- India started using this term since 1997-98
- Primary deficit is fiscal deficit minus interest payments
- It shows the current state of government finances
Answer: Option D
Answer: (d)
Primary deficit is fiscal deficit minus interest payments. India started using this term in 1997- 98.
Primary deficit is considered a very useful tool in helping bring more transparency in the government’s pattern of expenditure. It shows the current state of government finances.
If interest payments are deducted from a fiscal deficit, then it will obviously show a lesser deficit for that year as the interest payments are on account of loans taken in the past and not in the present year
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Answer: (d)
Primary deficit is fiscal deficit minus interest payments. India started using this term in 1997- 98.
Primary deficit is considered a very useful tool in helping bring more transparency in the government’s pattern of expenditure. It shows the current state of government finances.
If interest payments are deducted from a fiscal deficit, then it will obviously show a lesser deficit for that year as the interest payments are on account of loans taken in the past and not in the present year
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