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From the following data, Calculate Primary Deficit.

Rs (crore)
Revenue expenditure22,250
Capital expenditure28,000
Revenue receipts17,750
Capital receipts (net of borrowing)20,000
Interest payment5,000
Borrowings12,500

Solution

Correct Option: 1

Fiscal Deficit equals Borrowings, which is Rs 12,500 crore. Primary Deficit = Fiscal Deficit - Interest Payment = 12,5005,000=7,50012{,}500 - 5{,}000 = 7{,}500 crore. Hence Primary Deficit is Rs 7,500 crore.

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