0
Normally it should be.
Once deficit; from where you are going to finance it?
According to me there are three ways to overcome fiscal deficit
1) Theft to full-fill your requirement
2) Print the currency you require
and
3) Borrow the funds for financing.
The first part cannot be executed by any of the Govt., because Govt never steals.
The second part will necessarily increase inflation (Too much of money will fetch less of goods)
and Hence the third option is the best option, as financing can always be done by keeping mortgage equivalent to the borrowings. In this case also if the financing is not backed by the sufficient security, inflation is bound to rise.
What else can I help you with?
What is primary deficit?
Primary deficit is the gross deficit which is obtained by subtracting interest payments from budget deficit of any country of a particular year. We need to know the value of primary deficit, while calculating the fiscal deficit.Alternative Definition of Primary DeficitPrimary deficit corresponds to the net borrowing, which is required to meet the expenditure excluding the interest payment.Primary Deficit = (Fiscal Deficit - Interest Payment)Statistical reports: Primary deficit ( in India)In the fiscal year 1999-2000: primary deficit was (-) Rs.2598.72 croreIn the fiscal year 2000-2001: primary deficit was (-) Rs.1038.38 croreIn the fiscal year 2001-2002: primary deficit was (-) Rs.2598.72 croreOver the last few year the fiscal status of India has improved. In the fiscal year 2006-07, the revenue deficit in India was 2%, primary deficit was 0.1% and fiscal deficit was 3.7 percent. The government of India budget for 2007-08 predicts a revenue deficit of 1.5%, primary deficit of -0.2% and fiscal deficit of 3.3 percent.
How will a contractionary fiscal policy affect a budget deficit?
A contractionary fiscal policy, which involves reducing government spending or increasing taxes, typically aims to decrease the budget deficit. By lowering expenditures or raising revenues, the government can reduce its reliance on borrowing, leading to a smaller deficit. However, if the policy significantly slows economic growth, it could also reduce tax revenues, potentially offsetting some of the deficit reduction. Overall, if implemented effectively, contractionary fiscal policy should help improve the budget deficit situation.
Why fiscal deficit is good for the country?
Fiscal deficit is said to be good for the country as it helps the country to climb out of a recession.
What is fiscal consolidation?
Fiscal consolidation is a policy aiming at reducing fiscal deficit of government .
What is the difference among fiscal deficit budget deficit revenue deficit and trade deficit?
fiscal deficit: not enough money budget deficit: not as much money as you had planned to have in your budget revenue deficit: not enough money coming in trade deficit: you are spending more money on imports than the amount of money which you receive for your exports.
What is the reason for fiscal deficit in India?
The fiscal deficit in India is not fundamentally different from the fiscal deficit in any other country. The public always wants more government spending but they do not want more government taxes. The government attempts to oblige, by borrowing money. The result is a deficit.
What is primary deficit?
Primary deficit is the gross deficit which is obtained by subtracting interest payments from budget deficit of any country of a particular year. We need to know the value of primary deficit, while calculating the fiscal deficit.Alternative Definition of Primary DeficitPrimary deficit corresponds to the net borrowing, which is required to meet the expenditure excluding the interest payment.Primary Deficit = (Fiscal Deficit - Interest Payment)Statistical reports: Primary deficit ( in India)In the fiscal year 1999-2000: primary deficit was (-) Rs.2598.72 croreIn the fiscal year 2000-2001: primary deficit was (-) Rs.1038.38 croreIn the fiscal year 2001-2002: primary deficit was (-) Rs.2598.72 croreOver the last few year the fiscal status of India has improved. In the fiscal year 2006-07, the revenue deficit in India was 2%, primary deficit was 0.1% and fiscal deficit was 3.7 percent. The government of India budget for 2007-08 predicts a revenue deficit of 1.5%, primary deficit of -0.2% and fiscal deficit of 3.3 percent.
How will a contractionary fiscal policy affect a budget deficit?
A contractionary fiscal policy, which involves reducing government spending or increasing taxes, typically aims to decrease the budget deficit. By lowering expenditures or raising revenues, the government can reduce its reliance on borrowing, leading to a smaller deficit. However, if the policy significantly slows economic growth, it could also reduce tax revenues, potentially offsetting some of the deficit reduction. Overall, if implemented effectively, contractionary fiscal policy should help improve the budget deficit situation.
When the US spend more than it receives within a fiscal year this is call?
When the U.S. spends more than it receives within a fiscal year, this is called a budget deficit. A budget deficit occurs when the government's expenditures exceed its revenues, leading to an increase in national debt if the deficit is financed through borrowing. Ongoing budget deficits can raise concerns about fiscal sustainability and may impact economic growth.
Why fiscal deficit is good for the country?
Fiscal deficit is said to be good for the country as it helps the country to climb out of a recession.
What does federal deficit mean?
The federal deficit refers to the difference between the government's expenditures and its revenues over a specific period, usually a fiscal year. When the government spends more money than it receives through taxes and other income, it incurs a deficit, which must be financed through borrowing. The accumulated deficits over time contribute to the national debt. A persistent federal deficit can raise concerns about fiscal sustainability and economic stability.
What is primary deficit in a budget?
Primary deficit=Fiscal deficit-[minus] Interest payments
What is fiscal consolidation?
Fiscal consolidation is a policy aiming at reducing fiscal deficit of government .
What is the difference among fiscal deficit budget deficit revenue deficit and trade deficit?
fiscal deficit: not enough money budget deficit: not as much money as you had planned to have in your budget revenue deficit: not enough money coming in trade deficit: you are spending more money on imports than the amount of money which you receive for your exports.
Whether fiscal deficit is always bad?
Fiscal deficit is not always bad.... deficit arises from two parts - capital deficit and revenue deficit. now revenue deficit is obviously bad for economy stating that we are not able to pull money sufficient to meet our revenue and there is no asset creation. on the other hand if major fiscal deficit is coming from capital deficit its not all that a bad news. after all asset creation is taking place. n such moves are welcome.
What type of borrowing requires heavy spending?
Deficit.
Distinguish between deficit budget and surplus budget?
The main difference between the fiscal and budget deficit is of time period in consideration.Fiscal Deficit is the Govt. Deficit (Government Expenditures - Government Earnings (excluding borrowings)) for a fiscal year let say 2008-09 while...Budget Deficit is the Govt. Deficit in fiscal year 2008-09 (i.e. fiscal deficit for year 2008-09) plus the past Debt over the Government (i.e. the net sum of all past Fiscal deficit/surplus before fiscal year 2008-09).
