In the Annual Budget 2025, the Government of India set up disinvestment targets of ₹80000 crore. Such proceeds from disinvestment can be classified as ________ receipts in the government budget as it leads to ________ of the government.

Option 1 -> Disinvestment proceeds are capital receipts as they reduce government assets.

Option 2 -> Incorrect because disinvestment is not a revenue receipt and doesn't increase assets.

Option 3 -> While disinvestment is a capital receipt, it decreases assets, not increases liabilities.

Option 4 -> Disinvestment is not a revenue receipt and doesn't affect liabilities.

Hence, Option 1: capital, decrease in assets -> Disinvestment refers to the sale of government stake in Public Sector Undertakings (PSUs). When the government sells its shares or ownership in these enterprises, it is essentially converting its assets (shareholdings) into cash. This transaction is classified as a capital receipt because it involves disposal of assets and is non-recurring in nature. Capital receipts either create liabilities (like borrowings) or reduce assets (like disinvestment). In this case, disinvestment leads to a decrease in assets as the government's ownership in PSUs is reduced. The ₹80,000 crore disinvestment target in Budget 2025 represents capital receipts that will reduce government's investment assets. -> correct