Question

Distinguish between revenue deficit, fiscal deficit and primary deficit. 

Answer 1

Sr. No.	Basis	Revenue Deficit	Fiscal Deficit	Primary Deficit
1.	Definition	When revenue expenditure exceeds revenue receipts	Revenue deficit = Revenue expenditure – Revenue receipts	Day-to-day government spending vs. income
2.	Formula	Total borrowing requirement of the government	Fiscal deficit = Total expenditure – (Revenue receipts + Non-debt capital receipts)	Overall budget gap (excluding borrowings)
3.	Focus Area	Fiscal deficit excluding interest payments on past debt	Primary deficit = Fiscal deficit – Interest payments	Current fiscal gap without interest burden