Define capital receipts of government. Describe briefly the groups in which these are classified.
Download our app for free and get started
Capital receipts are government receipts that create liabilities or reduce assets.There are three major sources of capital receipts:
- Borrowings: The government borrows from two sources:
- Domestic borrowings: These are the borrowings within the country.
- External assistance: These are the borrowings from foreign governments and bodies (like IMF, World Bank).
- Recovery of loans: The government gives loans to state and local governments in the country. Recovery of this loan constitute capital receipts in the budget.
- Resale of shares of Public Sector Undertakings (Disinvestment): It is a recent source of capital receipts. Since 1991, the government has started the reselling of shares held by it to the general public and financial institution as a step towards privatisation. Resale of such shares by government is termed as "disinvestment in shares".
Download our appand get started for free
Experience the future of education. Simply download our apps or reach out to us for more information. Let's shape the future of learning together!No signup needed.*
Similar Questions
- 1View SolutionExplain how can government spending be helpful in removing deficient demand.
- 2View SolutionDefine multiplier. What is the relation between marginal propensity to consume and multiplier? Calculate the marginal propensity to consume if the value of multiplier is 4.
- 3View SolutionExplain the basis of classifying taxes into direct and indirect tax. Give examples.
- 4View SolutionWhat is debt trap? Suggest measures to control such situation.
- 5View SolutionCalculate budgetary deficit from the following data:
S. No. Items ₹(in crore) (i) Total expenditure 1,00,000 (ii) Total receipts 88,000 - 6View SolutionCan there be a fiscal deficit without a revenue deficit?
- 7View SolutionDoes public debt impose a burden? Explain.
- 8View SolutionWhat does a zero primary deficit indicates?
- 9View SolutionGive the relationship between the revenue deficit and the fiscal deficit.
- 10View SolutionElaborate the significance of the Goods and Services Tax (GST).