Debt and Deficit 1.Formulas 2.Figures 3.Fiscal repression
Debt and Deficit
1.Formulas2.Figures3.Fiscal repression
Debt
Other liabilities
Public Debt
Total Liabilities
•Total Receipts•Revenue •capital
•Total Expenditure•Revenue•capital
Budget Deficit
•Total Receipts•Revenue •capital
•Total Expenditure•Revenue•capital
Budget Deficit
Budget Deficit
borrowing
Sukhmoy Chakravarti: 97-98
Budget Deficit
Fiscal Deficit
+ Market Borrowing
- Interest Payments
Primary Deficit
Fiscal deficit, primary deficit
પ્રભા�વી� મહે સુ�લ ખા�ધ
Revenue Expenditure - Receipts
Revenue Deficit
- Grants for Capital Asset creation
Effective Revenue deficit
Fiscal Revenue
Eff. Revenue Primary
FRBM Act
Revenue deficit
0% by 31/3/2008
fiscal deficit3% of GDP by 31/3/2009
FRBM Act 2003
2012 amendmentERD 0% => 2015, 31st MarchFD 3% => 2017,31st March
FRBM
Fiscal Revenue
Eff. Revenue Primary
2006Fiscal Responsibility and Budget Management Act (FRBMA) concerns with __.
A. Fiscal deficit onlyB. Revenue deficit onlyC. Both fiscal deficit and revenue
deficitD.Neither fiscal deficit nor revenue
deficit
CAPF 2014Data presented in Interim Budget for 2014 — 2015 reveal that for the financial year 2013 — 2014, the revised estimates do not show a decline in ____.A. Revenue deficitB. Effective revenue deficitC. Fiscal deficitD. Primary deficit
CAPF 2014Data presented in Interim Budget for 2014 — 2015 reveal that for the financial year 2013 — 2014, the revised estimates do not show a decline in ____.A. Revenue deficitB. Effective revenue deficitC. Fiscal deficitD. Primary. deficit
High CADHigh Fiscal DeficitEconomic Survey: improved
Twin Deficit
Economic surveyReforms in Public Debt
Management • Ch.2 Issues and priorities• Ch.3 Public Finance
Public Debt => SLR, G-Sec to LIC/EPFO
Less return (~8%)Less incentive in Financial assetsMore investment in gold, real estate, overseas
Financial Repression વિવીત્તી�ય દમન
2012: household savings 7% of GDP2012: total borrowing by Union + State = 7.1%
“resource pre-emption” for private sector
More reliance on ECB => Currency volatility
NPA
Financial Repression વિવીત્તી�ય દમન
Solution: Public Debt Management authority
PDMA will sell G-Sec on voluntary basis
Same recommendationsVijay Kelar (13th FC) Justice BN Srikrishna (FSLRC)Sweden, NZ, Germany, Denmark etc have similar.
Financial Repression વિવીત્તી�ય દમન
2011: bill, but not passed2014Interim budget proposed Non-statutory PDMA (1/4/2014) but regime change
Economic Survey recommends samefull budget silent
Financial Repression વિવીત્તી�ય દમન