A country's fiscal deficit stands at ₹50,000 crores. It is receiving ₹10,000 crores through non-debt creating capital receipts. The country's interest liabilities are ₹1,500 crores. What is the gross primary deficit?
Verified Answer
A. ₹51,500 crores
B. ₹48,500 crores
C. ₹58,500 crores
D. None of the above
Explanation:
The primary deficit is calculated by subtracting interest payments from the fiscal deficit. Given: Fiscal Deficit (FD) = ₹50,000 crores Interest Liabilities (Interest Payments, IP) = ₹1,500 crores Primary Deficit (PD) = Fiscal Deficit - Interest Payments PD = ₹50,000 crores - ₹1,500 crores = ₹48,500 crores. The information about non-debt creating capital receipts is a distractor, as the fiscal deficit is already provided.