Given below are two statements: one is labelled as Assertion (A) and the other is labelled as Reason (R).
Assertion (A): Before 1991, there was a need for the government to use its remaining revenue in a highly efficient manner.
Reason (R): Before 1991, the government spent a large share of its income on the social sector and defence, which do not give immediate returns.
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → Both (A) and (R) are true and (R) is the correct explanation of (A).
When a large share of income goes into areas with no quick return, what is left must be used with great care.
Assertion (A): Before 1991, there was a need for the government to use its remaining revenue in a highly efficient manner. — True.
Reason (R): Before 1991, the government spent a large share of its income on the social sector and defence, which do not give immediate returns. — True. Spending on the social sector and defence does not give immediate returns.
Why R explains A?
A large share of income was going into areas that bring no quick return. So the government had only the rest of its revenue for everything else. That is the reason this remaining revenue had to be used very efficiently.
NCERT (2026-27): “3.2 Background … The continued spending on development programmes of the government did not generate additional revenue. Moreover, the government was not able to generate sufficiently from internal sources such as taxation. When the government was spending a large share of its income on areas which do not provide immediate returns such as the social sector and defence, there was a need to utilise the rest of its revenue in a highly efficient manner. The income from public sector undertakings was also not very high to meet the growing expenditure. …” |