Suppose the revenue expenditure is ₹80,000 crores and the revenue receipts of the Government are ₹60,000 crores. The Government budget also shows borrowings of ₹10,000 crores and interest payments of ₹6,000 crores. Which of the following statements are correct?

Correct Option

All three statements are correct based on the provided financial figures and standard definitions of budget deficits.

• Statement 1: Revenue Deficit is calculated as the difference between Revenue Expenditure and Revenue Receipts. Given Revenue Expenditure = ₹80,000 crores and Revenue Receipts = ₹60,000 crores, the Revenue Deficit = ₹80,000 crores - ₹60,000 crores = ₹20,000 crores. Therefore, statement 1 is correct.
• Statement 2: Fiscal Deficit represents the total borrowing requirements of the government. The problem explicitly states borrowings of ₹10,000 crores. By definition, these borrowings finance the fiscal deficit. Therefore, the Fiscal Deficit = ₹10,000 crores. Thus, statement 2 is correct.
• Statement 3: Primary Deficit is calculated by subtracting Interest Payments from the Fiscal Deficit. Using the calculated Fiscal Deficit of ₹10,000 crores and the given Interest Payments of ₹6,000 crores, the Primary Deficit = ₹10,000 crores - ₹6,000 crores = ₹4,000 crores. Therefore, statement 3 is correct.

Incorrect Options

Options 1, 2, and 3 are incorrect because they do not include all the correct statements. Since statements I, II, and III are all factually accurate based on the given data and established economic definitions, the option encompassing all three is the correct choice.