π Chapter 07 Β· Indian Economy Β· Financial System
Union Budget & Fiscal Policy
Budget components, revenue vs capital, deficit types, fiscal consolidation, FRBM Act β explained with real examples for UPSC & PSC exams.
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Sub-Topics
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Practice MCQs
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PYQs
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Very High
π What You Will Learn in This Chapter
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What is Union Budget?
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Revenue Budget vs Capital Budget
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Revenue receipts vs capital receipts
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Revenue deficit, fiscal deficit, primary deficit
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FRBM Act 2003 β fiscal consolidation
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Fiscal policy tools
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Finance Commission
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Consolidated Fund, Contingency Fund
π Chapter Sub-Topics β Click to Read
Topic 01
Union Budget β Structure & Components
What is Union Budget, Article 112, Revenue Budget vs Capital Budget, and how the budget is presented.
Topic 02
Revenue vs Capital β Receipts & Expenditure
Revenue receipts (tax + non-tax), capital receipts (borrowings, disinvestment), revenue expenditure vs capital expenditure.
Topic 03
Budget Deficits β Revenue, Fiscal & Primary Deficit
Revenue deficit, fiscal deficit, primary deficit β definitions, formulas, and examples. Why fiscal deficit matters.
Topic 04
FRBM Act 2003 & Fiscal Consolidation
Fiscal Responsibility and Budget Management Act, fiscal deficit targets, NK Singh Committee, and fiscal consolidation.
Topic 05
Finance Commission & Consolidated Fund
Finance Commission β composition, functions, devolution of taxes. Consolidated Fund, Contingency Fund, Public Account.
Topic 06
Fiscal Policy Tools & Quick Revision
Expansionary vs contractionary fiscal policy, automatic stabilisers, crowding out effect, and complete revision.
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