With reference to India rsquo s fiscal deficit consider following statements India rsquo s fiscal de...........

Economic Affairs Growth and Indicators

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With reference to India’s fiscal deficit, consider following statements

India’s fiscal deficit widened to 4.6% of the gross domestic product (GDP) in 2019-20.
The revenue deficit for 2019-20 was 3.27% of the GDP.

Select the correct statement.

1 only

2 only

Both

None

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Explanation:

India’s fiscal deficit widened to 4.6% of the gross domestic product (GDP) in 2019-20 mainly on account of poor revenue realisation, according to official data provided by the Controller General of Accounts (CGA). The fiscal deficit for 2019-20 worked out to be 4.59% of the GDP. The deficit, which signifies the gap between government revenue and expenditure, is higher than the revised estimate of 3.8% for the fiscal. The revenue deficit for 2019-20 was 3.27% of the GDP. The effective revenue deficit was 2.36%. Revenue receipts during the year worked out to be only 90% of the revised estimate. Hence both statements are correct.