Deficit Budget: How many types of deficit are there? Understand the difference between Fiscal and Revenue Deficit

After the presentation of the budget, you must have often heard the leaders of the opposition parties saying that the government has presented a ‘deficit budget’. While some governments claim many times that they have presented a ‘budget of benefits’. So after all this ‘deficit’ or ‘deficit budget’ (What is Deficit in Hindi?) What happens? What type of deficit does the government show in the budget? Most discussed fiscal deficit (Fiscal Deficit) and revenue deficit (Revenue Deficit) Why does it happen?

Deficit budget or profit budget?

So first of all understand what is loss. Simply put, when the money you have is less than the money you need to spend. Then you are at a loss and take steps like borrowing, or selling old assets to meet the remaining expenses. When the government presents such a budget, then it is said that the government has presented a ‘deficit budget’. ‘Budget of profit’ is that, when some money is left even after meeting your expenses.

How many types of deficit does the government show?

If the losses coming in the budget are mentioned, then Finance Minister Nirmala Sitharaman can mention these losses while presenting the budget on February 1, 2023. budget deficit in (Budget Deficit)Revenue Deficit, Fiscal Deficit, Current Account Deficit (Current Account Deficit)trade deficit (Trade Deficit) and primary deficit (Primary Deficit) Contains words like. Let’s know about all these…

1. Budget Deficit: Budget deficit means when the expenditure of the government is more than its revenue, then it is called budget deficit. This is an indicator showing the condition of the country’s economic health. It can also be understood when the expenditure of the government exceeds the expenditure of businesses and individuals in the country.
2. Fiscal deficit: First of all understand that from where the word treasury came. In the olden times, when kings and emperors used to collect taxes, from which a fund was created, such a fund is used by the ‘power’ (the ruling class). In those days it was used in the army and other public welfare works, in today’s time it is used for development works and social security. According to its original form, this fund is used in the same way even today. If you understand the fiscal deficit, it shows the difference between the expenditure and income of the government. When government expenditure is more than its income, then the government remains in deficit, this is its fiscal deficit.
3. revenue loss: The government makes an estimate of its income in the budget. When his income is less than the estimate, then this loss is called revenue deficit. Let’s assume that the government estimated to earn Rs 100 in the budget but its income was Rs 98, then it means its revenue deficit was Rs 2.
4. current account deficit: This deficit is related to the import-export of the country. When the bill of goods imported from abroad in the country (Import Bill) is more than that sent from abroad (Export Bill), then this difference shows the current account deficit of the country.
5. trade deficit: To understand this easily, we can understand the trade between India and China. In the year 2022, there was a trade of $ 135.98 billion between India and China. In this, where China exported goods worth $118.5 billion to India. At the same time, India sent goods worth only $ 17.48 billion to China. Now the difference between these two import-export, there is a trade deficit between the two countries. Accordingly, the trade deficit between China and India stood at $101.02 billion. Its loss was more to India, because India’s import is more than its export to China. This difference will further add to the current account deficit.