Before the crisis of 1991, the government spent a large share of its income on areas which do not provide immediate returns. Which of the following were such areas?
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → Both (1) and (2)
Before 1991, the government spent a large share of its income on the social sector and defence. These areas do not give immediate returns.
Option (1) Social sector — Correct statement, but it is only one of the correct points, so on its own it is not the answer. It is one of the two areas named.
Option (2) Defence — Correct statement, but it is only one of the correct points, so on its own it is not the answer. It is the other area named.
NCERT (2026-27): “3.2 Background … 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. …” |