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Question No. 242Interactive Test Mode
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Q242. In the context of governance, consider the following: 1. Encouraging Foreign Direct Investment inflows 2. Privatization of higher educational Institutions 3. Down-sizing of bureaucracy 4. Selling/offloading the shares of Public Sector Undertakings Which of the above can be used as measures to control the fiscal deficit in India?

In the context of governance, consider the following:

  1. Encouraging Foreign Direct Investment inflows
  2. Privatization of higher educational Institutions
  3. Down-sizing of bureaucracy
  4. Selling/offloading the shares of Public Sector Undertakings Which of the above can be used as measures to control the fiscal deficit in India?
Select the correct option below (or cross out options to eliminate)

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.

Official UPSC Answer KeyUPSC Prelims 2010 • Indian Economy

Correct Answer: Option (D) — 3 and 4 only

Concept & Option Breakdown

Standard Reference Verified

Fiscal 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.
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Question Specifications & Syllabus Mapping

Examination & YearUPSC Civil Services Preliminary Examination 2010 (Q242)
Paper & Marking SchemeGS Paper I • 2 Marks (-0.66 Negative for incorrect response)
Syllabus Subject & TopicIndian Economy → Fiscal Policy & Public Finance
Official Answer KeyOption (D) — 3 and 4 only

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Frequently Asked Questions — UPSC Prelims 2010 Q242

What is the official answer for UPSC Prelims 2010 GS Paper I Question 242 (Indian Economy)?

The official UPSC answer key for this 2010 Indian Economy (Fiscal Policy & Public Finance) question is Option (D): "3 and 4 only". Correct attempts carry 2 Marks with -0.66 Negative penalty for wrong answers.

Which UPSC Prelims syllabus topic does this 2010 question belong to?

This question belongs to GS Paper I under the subject "Indian Economy" and micro-topic "Fiscal Policy & Public Finance". You can explore all repeated questions from Fiscal Policy & Public Finance in Acme AI's 3D Prelims PYQ Realm or practice 50 full-length and sectional tests in the APT Prelims Test Series.

How can I solve this Fiscal Policy & Public Finance UPSC Prelims question using option elimination?

To solve Fiscal Policy & Public Finance questions in UPSC Prelims, identify extreme modifiers, verify core NCERT conceptual definitions, and eliminate mutually contradictory statement pairs before locking your final option.

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