Question

In the Union Budget of 2026, the target of the fiscal deficit as a percentage of GDP is:

• A. 3.2%
• B. 4.3%
• C. 5.6%
• D. 6.8%

Hint:

Remember: \[ \boxed{ \text{Fiscal Deficit} = \text{Government Borrowing Requirement} } \] A lower fiscal deficit generally indicates better fiscal discipline and helps maintain macroeconomic stability.

Answer 1

The Correct Option is B

Concept: Fiscal Deficit is the excess of the government's total expenditure over its total receipts (excluding borrowings). It indicates the amount the government needs to borrow to finance its expenditure. The formula is: \[ \boxed{ \text{Fiscal Deficit} = \text{Total Expenditure} - (\text{Revenue Receipts}+\text{Non-debt Capital Receipts}) } \] Fiscal deficit is generally expressed as a percentage of the Gross Domestic Product (GDP).

Step 1: Recall the fiscal deficit target in the Union Budget 2026. In the Union Budget 2026, the Government of India announced a fiscal deficit target of \[ \boxed{4.3\% \text{ of GDP}} \] This reflects the government's commitment towards fiscal consolidation under the Fiscal Responsibility and Budget Management (FRBM) framework.

Step 2: Examine the given options.
• [(A)] 3.2% is not the fiscal deficit target announced in the Union Budget 2026.
• [(B)] 4.3% is the announced fiscal deficit target.
• [(C)] 5.6% was associated with higher fiscal deficits in earlier years.
• [(D)] 6.8% was recorded during the post-pandemic fiscal expansion period and is not the Budget 2026 target. Hence, \[ \boxed{ \text{The fiscal deficit target in the Union Budget 2026 is }4.3\%\text{ of GDP.} } \] Therefore, \[ \boxed{(B)\;4.3\%} \]