66th B.P.S.C. (Pre) 2020
Revenue deficit in India implies that :
aThe Indian Government needs to borrow in order to finance its expenses which will create capital assets
bThe Indian Government needs to borrow in order to finance its expenses which do not create capital assets✓ Correct
cThe Indian Government needs to borrow from the Reserve Bank of India against government securities
dThe Indian Government needs to borrow from international financial institutions
eNone of the above / More than one of the above
Explanation
When the government’s revenue expenditure exceeds its revenue receipts, this gap is called the revenue deficit. To meet this gap, the government borrows, but such borrowing does not create any capital asset; rather, it only meets operating costs or day-to-day expenses.
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