- Government expenditure in India is classified into Revenue Expenditure and Capital Expenditure, and traditionally also into Plan and Non-Plan Expenditure. Non-Plan Expenditure constitutes the largest part of the government's total expenditure. - Revenue Expenditure includes all those expenditures of the government that do not result in the creation of physical or financial assets. Non-Plan Revenue Expenditure covers the essential running costs of the government and various obligations. - Item 1: Interest payments on the national debt are a major component of non-plan revenue expenditure, representing the cost of borrowing. - Item 2: Major subsidies provided by the government (like food, fertilizer, petroleum) are also part of non-plan revenue expenditure, aiming at social welfare or economic support. - Item 3: Pensions paid to retired government employees are also classified as non- plan revenue expenditure. - Item 4: Loans and advances given by the Central Government to states, union territories, public sector undertakings, or other parties are typically classified as Capital Expenditure because they are financial assets for the central government (recoverable advances).
The following are some of the items of expenditure of the Central Government in India : Interest payments 1. Major subsidies 2. Pensions 3. Loans and advances 4. Which of the above is/are included in non-plan revenue expenditure?
Asked in UPSC CAPF 2013 · Topic: Fiscal Policy & Revenue (Public Expenditure: Classification, trends, and impact on development)
More Economic Development questions
- Which one of the following is the largest component of revenue expenditure in the Union Budget 2022 – 23 ?
- The Global Infrastructure Facility is a/an
- Consider the following statements : The 'National Investment and Infrastructure Fund' was created to 1. promote Foreign Direct Investment in India 2. support infrastructure projects in the country 3. attract venture capital for startups 4. finance defence projects Which of the above statements is/are correct?
- Development expenditure of the Central Government does not include
- Expenditure for public administration falls under
- The major share of expenditure in the Union budget 2023-24 goes to—
- Which of the following is not regarded as public expenditure in India?
- In the Union Budget the largest item of revenue expenditure is