Which of the following is/are included in the capital budget of the Government of India? 1. Expenditure on acquisition of assets like roads, buildings, machinery, etc. 2. Loans received from foreign governments 3. Loans and advances granted to the States

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Q: 87 (IAS/2016)

Which of the following is/are included in the capital budget of the Government of India?
1. Expenditure on acquisition of assets like roads, buildings, machinery, etc.
2. Loans received from foreign governments
3. Loans and advances granted to the States and Union Territories
Select the correct answer using the code given below.

question_subject: 

Economics

question_exam: 

IAS

stats: 

0,148,106,54,16,36,148

keywords: 

{'capital budget': [0, 0, 0, 1], 'expenditure': [2, 0, 2, 4], 'india': [8, 1, 7, 13], 'loans': [1, 1, 4, 14], 'government': [5, 0, 0, 1], 'foreign governments': [0, 0, 0, 2], 'assets': [0, 1, 1, 9], 'union territories': [1, 0, 1, 1]}

The capital budget of the Government of India includes three main aspects.

1. Expenditure on acquisition of assets like roads, buildings, machinery, and so on: This refers to the government`s spending on creating long-term assets that increase the country`s productivity and improve the quality of public services.

2. Loans received from foreign governments: These are borrowings that the government makes from foreign governments or international institutions. They form a part of the capital budget because they result in an increase in the government`s liabilities, analogous to a company`s capital structure.

3. Loans and advances granted to the States and Union Territories: These are the funds that the central government provides to the states and U.T.s, either as loans to be paid back or as advances. They form part of the capital budget because they represent a deployment of the government`s resources in the form of loans, similar to investments made by a business.

All three options are therefore included in the capital budget which make option 4 (1, 2 and 3) the correct one.