What does the primary deficit in the budget indicate?
Answer & explanation
Correct answer: option 2
The correct answer is Option 2: It indicates the amount of borrowings required to meet the expenditure other than the interest payments
Primary deficit = Fiscal deficit - interest payments
Primary deficit refers to the difference between fiscal deficit of the current year and interest payments on the previous borrowings. It indicates the amount of borrowings required to meet expenditure other than the interest payments.
It refers to the amount of borrowings required to meet the expenditure other than the interest payments.