General Knowledge - Indian Economy - Discussion

Discussion :: Indian Economy - Indian Economy (Q.No.34)


Deficit financing means that the government borrows money from the

[A]. RBI
[B]. local bodies
[C]. big businessmen
[D]. IMF

Answer: Option A


No answer description available for this question.

Nagaraju said: (Jan 5, 2011)  
How is it possible RBI is also part of central govt?

Priyanka Singh said: (Aug 16, 2011)  
But RBI is the central bank for the country which provides money to the government if the is running in deficit it borrows money from IMF please explain the difference.

Manish Soni said: (Sep 1, 2011)  
In the event of financial deficit govt ask aid fronm the rbi first, even if not sufficiant, rbi is supposed to ask money from imf but govt can't ask the money directly to imf.

Parag said: (May 25, 2012)  
The Cycle is that in case of Deficit Financing, the govt asks money to the RBI(which is a central bank) and the central bank then asks money from the International Monetory Fund( through the Special Drawing Rights-which is held only by the RBI in INDIA).
(Please do correct me if I am wrong)

Siraj Bardhan said: (May 27, 2012)  
If the usual sources of finance are inadequate for meeting public expenditure, a government may take resort to deficit financing, particularly in India. A budgetary deficit to an excess of total budgetary expenditure over total budgetary receipts. The deficit may be met by raising the rates of taxation or by charging higher prices for goods and services supplied by the Government The deficit may also be met from the accumulated cash balances of the Govt. , or by borrowing from the banking system. If the last two methods are followed, there is said to be deficit financing.

Vinod Chaudhary said: (Dec 10, 2014)  
What is the full form of IMF?

Gunjan said: (Mar 23, 2015)  
IMF: International Monetary Fund.

Pranab said: (Jul 10, 2015)  
Definition of deficit finance:

When the budget deficit is financed by borrowing from the public and banks, it is called deficit financing. Deficit financing refers to the borrowing undertaken by the government to make up for the revenue shortfall.

Shariq Wani said: (Dec 30, 2016)  
What is exact Deficit financing?

Chandrashekar said: (Nov 24, 2018)  
The financing when there is Shortfall in revenue.

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