Official Answer Key & Detailed Solution
Ready to check the official UPSC Answer Key?
Click any option above to test yourself under exam conditions, or reveal the explanation directly.
Correct Answer: Option (D) — 3 and 4 only
Concept & Option Breakdown
Standard Reference VerifiedFiscal deficit is the excess of total budget expenditure over total non-debt receipts:
- Statement 1 is incorrect: Foreign Direct Investment (FDI) inflows enter the private/corporate sector and do not form part of the government's budgetary revenue or deficit calculations.
- Statement 2 is incorrect: Privatization of higher education is a structural sector policy rather than a recognized budgetary deficit-control measure.
- Statement 3 is correct: Downsizing bureaucracy directly lowers recurring revenue expenditure on salaries, pensions, and establishment costs, thus reducing the deficit.
- Statement 4 is correct: Disinvestment of public sector undertaking (PSU) shares brings non-debt capital receipts into the budget, directly bridging the fiscal deficit.
Practice Full-Length & Sectional Prelims Mocks on this Interface
50 simulated tests in the APT Prelims Test Series (₹1,493) or 1-on-1 Mentorship with Avinash Sir.