National income, growth & inflation

Answer: (b) A situation where Government borrowing leads to higher interest rates, which reduces private investment

Crowding out happens when heavy government borrowing absorbs the available savings and raises the cost of funds, leaving less credit and lower investment for the private sector. Option (b) states exactly this.

• ✓ (b) Government borrowing competes with private borrowers for savings and credit; the RBI’s Urjit Patel Committee report notes government market borrowing crowding out funds to the private sector.
• ✗ (a) This is the opposite, called crowding in, where government spending raises private investment.
• ✗ (c) Higher taxes reduce, not raise, private disposable income and do not describe crowding out.
• ✗ (d) Crowding out is about the effect on private investment; government spending does affect aggregate demand.

Remember · Crowding out: government borrowing pushes up interest rates or absorbs credit, so private investment falls. Opposite: crowding in.

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Answer: (b) Only two

Only pairs 2 and 4 are right. Dairy farming works on natural products, so it is primary, and weaving turns yarn into cloth, so it is secondary. Storage is a support service, so it is tertiary, and mineral work belongs with mining, a primary activity.

• ✗ 1. Storing farm produce in godowns supports production and trade without making a good. NCERT lists storage among tertiary (service) activities, not secondary.
• ✓ 2. Milk is a natural product from animals. NCERT places agriculture, dairy, fishing and forestry in the primary sector.
• ✗ 3. Minerals and ores are natural products, and mining is a primary activity. Mineral exploration is part of that work, not a support service like banking or trade.
• ✓ 4. Weaving makes cloth from yarn through manufacturing, which is the mark of the secondary sector.

Remember · Primary means taking from nature (farming, dairy, mining). Secondary means manufacturing (weaving). Tertiary means supporting services (transport, storage, banking, trade).

📘 Read it in NCERT: Class 10 Understanding Economic Development, Ch 2 (practise this chapter) · Class 10 Understanding Economic Development, Ch 2 (practise this chapter) · Class 10 Understanding Economic Development, Ch 2 (practise this chapter) · Class 12 Fundamentals of Human Geography, Ch 4 (practise this chapter)

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Answer: (b) Only two

Fixed capital is durable equipment that keeps yielding service for years. Working capital is what production uses up, such as raw materials and fuel. So the computer (fixed) and petrol (working) are matched correctly, while the plough is fixed capital and the weaver's yarn is working capital.

• ✗ 1. A plough is a durable implement used season after season. It is fixed capital, not working capital.
• ✓ 2. A computer is a machine that serves for years without being consumed, so it is fixed capital.
• ✗ 3. Yarn is a raw material that is used up in making cloth. NCERT places raw materials like cloth among working-capital needs and sewing machines and handlooms among assets, so yarn is working capital.
• ✓ 4. Petrol is burnt up when used, an input consumed in production, so it is working capital.

Remember · Fixed capital: durable tools and machines that serve for years. Working capital: inputs used up in production, such as raw materials and fuel.

📘 Read it in NCERT: Class 12 Introductory Macroeconomics, Ch 4 (practise this chapter) · Class 10 Understanding Economic Development, Ch 3 (practise this chapter)

Question and answer: UPSC's official GS Paper I (2024, Series A) — paper ↗ · answer key ↗. Explanation: Minimalist IAS, checked 30 Sept 2026 (how we verify). Permalink · Report an error

Answer: (a) Both Statement-I and Statement-II are correct and Statement-II is the correct explanation for Statement-I

After the pandemic and the Russia-Ukraine war pushed prices up, central banks led by the US Federal Reserve raised policy rates in step with one another. They did so because they believe that dearer money cools demand and brings inflation down, so Statement-II explains Statement-I.

• ✓ Statement-I The Economic Survey 2022-23 records synchronised policy rate hikes by central banks across economies to curb inflation, with the US Federal Reserve raising rates at its fastest pace since the 1970s.
• ✓ Statement-II Monetary policy is the main tool central banks use against inflation; in India the RBI Act makes price stability the primary objective of monetary policy, with a flexible inflation target.

Remember · Inflation up → central bank raises policy rate (repo) → borrowing costlier → demand cools → prices ease. RBI: primary objective is price stability, keeping growth in mind.

Question and answer: UPSC's official GS Paper I (2023, Series A) — paper ↗ · answer key ↗. Explanation: Minimalist IAS, checked 30 Sept 2026 (how we verify). Permalink · Report an error

Answer: (c) Only three

An intangible asset has no physical substance: brands, patents and copyrights, software, and customer or mailing lists. Inventory (raw materials, work in progress and finished goods) is physical stock, so it is a tangible asset. Three of the four are intangible.

• ✓ 1. Spending on building a brand creates value that has no physical form; accounting standards treat brands and trademarks as intangible items.
• ✗ 2. Inventory consists of physical goods held for production or sale, a tangible (current) asset.
• ✓ 3. Intellectual property such as patents, copyrights and trademarks is the classic example of an intangible asset.
• ✓ 4. A mailing list of clients is a customer list, which accounting standards list alongside brands and publishing titles as an intangible item.

Remember · Intangible = no physical substance: brands, IP (patents, copyrights, trademarks), software, customer lists, goodwill. Inventory, machinery and buildings are tangible.

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Answer: (a) 1 and 2 only

The real sector is the part of the economy that actually produces goods and services — farms, factories and the like. Bank lending and bond issues move money and claims around; they belong to the financial sector, however useful they are to production.

• ✓ 1. Harvesting crops is primary-sector production of real goods from natural resources.
• ✓ 2. A textile mill turning raw cotton into fabric is manufacturing — secondary-sector production.
• ✗ 3. A bank loan is a financial transaction: it creates a claim (a debt) rather than producing a good, so it is financial-sector activity.
• ✗ 4. Issuing rupee-denominated (masala) bonds abroad is a way of raising funds in financial markets, not production of goods or services.

Remember · Real sector = production of goods and services (agriculture, industry, services output). Lending, borrowing and bond issues = financial sector.

📘 Read it in NCERT: Class 10 Understanding Economic Development, Ch 2 (practise this chapter) · Class 10 Understanding Economic Development, Ch 2 (practise this chapter)

Question and answer: UPSC's official GS Paper I (2022, Series A) — paper ↗ · answer key ↗. Explanation: Minimalist IAS, checked 30 Sept 2026 (how we verify). Permalink · Report an error

Answer: (d) Reserve Bank of India

The Reserve Bank of India is responsible for price stability and for keeping inflation on target. Its Monetary Policy Committee sets the policy rate to meet the inflation target that the Central Government notifies.

• ✓ (d) Under the RBI Act, 1934 the primary objective of monetary policy is price stability, keeping growth in mind. The Act gives a statutory basis to flexible inflation targeting, and the RBI controls money supply through the bank rate, open market operations and reserve ratios.
• ✗ (a) The Department of Consumer Affairs is a government department and has no power over money supply or the policy rate, so it cannot be the body that controls inflation through monetary policy.
• ✗ (c) The Financial Stability and Development Council is a coordination forum for financial-sector regulators; the inflation target and policy rate are the RBI's job.

Remember · Price stability and the inflation target (4 per cent CPI, with a 2-6 per cent band) are the RBI's mandate, delivered by its six-member Monetary Policy Committee.

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Answer: (b) Increase in expenditure on public projects

A recession is a shortfall of demand, so the remedy is to add demand. Government spending on public projects is itself part of aggregate demand and, through the multiplier, raises output and income by more than the amount spent.

• ✓ (b) Higher public spending directly adds to aggregate demand, creates jobs and incomes, and so counters the slump.
• ✗ (a) The tax cut helps, but raising interest rates at the same time makes borrowing dearer and holds back investment and consumption, working against recovery.
• ✗ (d) Cutting public spending removes demand from an economy that already lacks it and would deepen the recession.

Remember · Recession = too little demand. Counter it with expansionary fiscal policy (more public spending, lower taxes) and easier money (lower interest rates).

📘 Read it in NCERT: Class 12 Introductory Macroeconomics, Ch 4 (practise this chapter) · Class 12 Introductory Macroeconomics, Ch 5 (practise this chapter)

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Answer: (a) 1 and 4 only

Demand for a good rises when a substitute gets dearer and when its own price falls. A dearer complement and higher income for an inferior good both push demand down.

• ✓ 1. If coffee becomes costlier, buyers switch to tea, its substitute, so demand for tea goes up.
• ✗ 2. Complements are used together (tea and sugar), so a rise in the complement's price reduces demand for the good.
• ✗ 3. By definition, demand for an inferior good such as coarse cereals falls as consumers' income rises and they shift to better goods.
• ✓ 4. The law of demand: other things equal, a lower price raises the quantity demanded.

Remember · Demand rises with: dearer substitute, cheaper complement, own price falling, and (for normal goods) higher income. Inferior goods reverse the income effect.

📘 Read it in NCERT: Class 12 Introductory Microeconomics, Ch 2 (practise this chapter) · Class 12 Introductory Microeconomics, Ch 2 (practise this chapter) · Class 12 Introductory Microeconomics, Ch 2 (practise this chapter) · Class 12 Introductory Microeconomics, Ch 2 (practise this chapter)

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Answer: (d) Creation of new money to finance a budget deficit

A deficit can be financed by taxes, borrowing or printing money. Borrowing only moves existing money from lenders to the government, but creating new money adds to the money supply while the supply of goods stays the same, so it pushes prices up the most.

• ✓ (d) New money raises total spending power without adding output, the classic cause of demand-pull inflation.
• ✗ (b) Borrowing from the public takes money people would otherwise have spent or saved, so the net addition to demand is smaller.
• ✗ (c) Bank borrowing uses deposits already in the system; it can add to demand but far less than fresh money creation.

Remember · Deficits are financed by taxation, borrowing or printing money; printing (monetising) the deficit is the most inflationary.

📘 Read it in NCERT: Class 12 Introductory Macroeconomics, Ch 5 (practise this chapter) · Class 12 Introductory Macroeconomics, Ch 5 (practise this chapter)

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Answer: (a) 1, 2 and 4 only

Demand-pull inflation happens when total demand outruns what the economy can supply. Expansionary policy, a fiscal stimulus and higher purchasing power all raise demand. Indexing wages to inflation works through costs, and rising interest rates reduce demand, so 3 and 5 do not fit.

• ✓ 1. Expansionary monetary or fiscal policy puts more money and spending into the economy, lifting aggregate demand.
• ✓ 2. A fiscal stimulus (more government spending or tax cuts) directly raises aggregate demand; if firms cannot raise output fast enough, prices rise.
• ✗ 3. Linking wages to inflation raises firms' labour costs and feeds a wage-price spiral, which is usually classed as cost-push, not demand-pull, inflation.
• ✓ 4. When people have more purchasing power they buy more, and demand racing ahead of supply pulls prices up.
• ✗ 5. Higher interest rates make borrowing dearer and reduce money supply, so they dampen demand; central banks raise rates to fight inflation.

Remember · Demand-pull: too much money chasing too few goods (stimulus, easy money, higher incomes). Cost-push: rising input costs such as wages or oil.

📘 Read it in NCERT: Class 12 Introductory Macroeconomics, Ch 5 (practise this chapter) · Class 12 Introductory Macroeconomics, Ch 3 (practise this chapter)

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Answer: (b) 3 and 4 only

After liberalisation, rural India's non-farm economy grew faster while rural employment growth slowed and even turned negative, so statements 3 and 4 are correct. Statements 1 and 2 are wrong: output per worker rose in rural areas too, and the rural share of the workforce kept falling.

• ✗ 1. Rural productivity did not fall. Rural output at 2004-05 prices rose from Rs 3,199 billion (1970-71) to Rs 21,107 billion (2011-12) while rural employment rose only from 191 to 336 million, so output per rural worker went up from about Rs 16,700 to about Rs 62,800 (our calculation from these figures).
• ✗ 2. The rural share of the workforce fell, from 84.1 per cent in 1970-71 to 70.9 per cent in 2011-12, as urbanisation proceeded.
• ✓ 3. Growth of rural non-farm output rose from 5.70 per cent a year (1971-94) to 7.93 per cent (1994-2005) and 9.21 per cent (2005-12), while agriculture lagged.
• ✓ 4. Total rural employment growth fell from 2.16 per cent a year (1973-94) to 1.45 per cent (1994-2005) and turned negative (-0.28 per cent) in 2005-12.

Remember · Since liberalisation, rural non-farm output has grown faster and faster, but rural employment growth has fallen; the rural share of India's workforce has kept declining.

Question and answer: UPSC's official GS Paper I (2020, Series A) — paper ↗ · answer key ↗. Explanation: Minimalist IAS, checked 30 Sept 2026 (how we verify). Permalink · Report an error

Answer: (a) 1 and 2 only

Statements 1 and 2 are correct, and 3 is wrong. Food has a far larger weight in CPI (45.86 per cent in the combined index) than in WPI (24.38 per cent), and WPI tracks goods only, so it misses services that CPI includes. The RBI's inflation target is fixed in terms of CPI, not WPI.

• ✓ 1. In CPI (base 2012, combined) food and beverages carry a weight of 45.86 per cent; the WPI Food Index has a weight of 24.38 per cent.
• ✓ 2. WPI covers commodities, and RBI's expert committee noted that it does not capture price movements in services such as those in the CPI basket (housing, health, transport and communication).
• ✗ 3. Under Section 45ZA of the RBI Act the Central Government sets the inflation target in terms of CPI (4 per cent, with a 2 to 6 per cent band, notified in August 2016), and the RBI works to it.

Remember · CPI measures retail prices, has a heavy food weight, includes services and is the RBI's inflation-target anchor. WPI is wholesale prices of goods only, with a lighter food weight.

Question and answer: UPSC's official GS Paper I (2020, Series A) — paper ↗ · answer key ↗. Explanation: Minimalist IAS, checked 30 Sept 2026 (how we verify). Permalink · Report an error

Answer: (a) long-term damage done by a tonne of CO2 emissions in a given year.

The Social Cost of Carbon is the money value of the long-term damage caused by one extra tonne of carbon dioxide emitted in a given year. Governments use it to weigh the benefits of cutting emissions against the costs of a policy.

• ✓ (a) This is the standard definition: a measure, in money terms, of the long-term damage done by a tonne of CO2 emitted in a given year; the same figure equals the damage avoided by cutting that tonne.
• ✗ (b) This describes a country's fossil-fuel demand, which is not a monetary damage measure.
• ✗ (c) The cost of adaptation by a climate refugee is not what the term measures; it values damage from emissions.
• ✗ (d) An individual's contribution is a personal carbon footprint, not the Social Cost of Carbon.

Remember · Social Cost of Carbon = money value of the long-term damage from one extra tonne of CO2 emitted in a year; equally, the benefit of avoiding it.

Question and answer: UPSC's official GS Paper I (2020, Series A) — paper ↗ · answer key ↗. Explanation: Minimalist IAS, checked 30 Sept 2026 (how we verify). Permalink · Report an error

Answer: (b) price levels vary from State to State

A poverty line is the money needed to buy a fixed minimum basket of goods and services. Because the same basket costs different amounts in different States, the Planning Commission set separate State poverty lines that reflect inter-state price differences.

• ✓ (b) The Planning Commission's 2011-12 estimates (Tendulkar method) gave all-India lines of Rs 816 (rural) and Rs 1,000 (urban) per person per month and stated that these vary by State because of inter-state price differentials.
• ✗ (a) Poverty rates are the result of applying the line to consumption data; they do not set the line.
• ✗ (c) State income (GSDP) affects how many people fall below the line, not the cost of the minimum basket that defines it.
• ✗ (d) PDS quality influences household consumption, but the official line is priced from the consumption basket, not from PDS performance.

Remember · Poverty line = cost of a minimum consumption basket; State lines differ because prices differ (Tendulkar 2011-12: Rs 816 rural, Rs 1,000 urban per capita per month, all-India).

Question and answer: UPSC's official GS Paper I (2019, Series A) — paper ↗ · answer key ↗. Explanation: Minimalist IAS, checked 30 Sept 2026 (how we verify). Permalink · Report an error

Answer: (a) 1 and 2 only

Statements 1 and 2 are correct. The Second Plan (1956-61) made heavy and capital-goods industries the core of its strategy, and the Fourth Plan (1969-74) set out to reduce the concentration of income, wealth and economic power. UPSC's key treats statement 3 as wrong.

• ✓ 1. The Second Plan document stresses that basic and capital goods industries are 'major determinants of the rate of growth' and says it is desirable to go farthest in developing heavy and capital goods industries. This was the industrialisation strategy of the Second Plan.
• ✓ 2. The Fourth Plan document says that benefits of development must reach the less privileged and there should be 'progressive reduction of the concentration of incomes, wealth and economic power'. It also noted no sign of any reduction in that concentration so far.
• ✗ 3. UPSC's official key treats this statement as incorrect; we could not confirm the detail from an official source, so we do not explain it here.

Remember · Second Plan: heavy and capital-goods industry. Fourth Plan: reduce concentration of wealth and economic power.

Question and answer: UPSC's official GS Paper I (2019, Series A) — paper ↗ · answer key ↗. Explanation: Minimalist IAS, checked 1 Oct 2026 (how we verify). Permalink · Report an error

Answer: (d) The level of mutual trust and harmony in the society

Social capital means the networks, shared norms and trust that let people in a society cooperate, so the level of mutual trust and harmony is part of it. Literacy, buildings and machines, and the size of the workforce are other kinds of resource, not social capital.

• ✓ (d) The World Bank defines social capital in terms of social networks and norms, and measures it through dimensions such as trust and solidarity and social cohesion.
• ✗ (a) Literacy is education and skill, which economists count as human capital, not social capital.
• ✗ (b) Buildings, infrastructure and machines are physical capital: material assets, not relationships between people.
• ✗ (c) The size of the working-age population is a demographic (labour) resource; it says nothing about how far people trust and cooperate with each other.

Remember · Social capital = networks, shared norms and trust that help people cooperate. Roads and machines are physical capital; literacy and skills are human capital.

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Question and answer: UPSC's official GS Paper I (2019, Series A) — paper ↗ · answer key ↗. Explanation: Minimalist IAS, checked 30 Sept 2026 (how we verify). Permalink · Report an error

Answer: (a) 1 only

PPP exchange rates are worked out by comparing what the same goods and services cost in different countries, so statement 1 is correct. In PPP terms India was the third largest economy, behind China and the USA, not the sixth, so statement 2 is wrong.

• ✓ 1. The World Bank's International Comparison Program collects prices of the same goods and services in many economies and uses them to compute PPPs, which convert a common basket of goods into 'international dollars'.
• ✗ 2. In the 2017 ICP round India's GDP in PPP terms was $8,051 billion, 6.7 per cent of the world total and third after China (16.4 per cent) and the USA (16.3 per cent). India has held third place in PPP terms since 2008, when it passed Japan.

Remember · PPP compares the price of the same basket across countries. On a PPP basis India has been the world's third largest economy since 2008.

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Answer: (c) the opportunity cost is transferred from the consumers of the product to the tax-paying public.

Free public provision does not remove the cost. The resources used still have other uses, and the bill is met through the government budget, which taxes help to fund, so the burden moves from the user to the tax-paying public.

• ✓ (c) When goods are provided publicly, they are financed through the budget and users pay nothing directly. Tax revenue is an important part of budget receipts, so taxpayers bear the cost that consumers would otherwise have paid.
• ✗ (a) Opportunity cost is what is given up when resources are used for one purpose instead of another. Producing the commodity always uses scarce resources, so the cost cannot be zero.
• ✗ (b) The cost is not ignored in economics. It has only moved from the consumer to someone else.
• ✗ (d) The government pays for the commodity out of the budget, which is funded mainly by receipts such as taxes. The burden therefore falls on taxpayers, not on the government as a separate bearer.

Remember · Free to the user is not free to society: public provision shifts the cost from the consumer to taxpayers through the budget.

📘 Read it in NCERT: Class 12 Introductory Macroeconomics, Ch 5 (practise this chapter) · Class 12 Introductory Macroeconomics, Ch 5 (practise this chapter) · Class 12 Introductory Microeconomics, Ch 1 (practise this chapter)

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Answer: (c) poverty and unemployment increase.

Rising GNP and per capita GNP show growth, but development also needs the gains to reach people. If poverty and unemployment increase, the income growth has not improved living standards, so it does not signal a higher level of development.

• ✓ (c) Development is wider than income growth. NCERT notes that even countries with high growth saw poverty rise quickly because the gains were shared unequally. Growth with rising poverty and unemployment is not development.
• ✗ (a) The balance between industry and agriculture affects the structure of the economy but says nothing about whether people are better off.
• ✗ (b) Industry growing faster than agriculture is a normal feature of structural change and does not by itself deny development.
• ✗ (d) Imports growing faster than exports widens the trade deficit. It is a balance-of-payments concern, not a test of whether GNP growth means development.

Remember · Growth (GNP, per capita income) is not the same as development. Rising poverty and unemployment show that growth has not turned into development.

📘 Read it in NCERT: Class 12 India: People and Economy, Ch 6 (practise this chapter) · Class 12 India: People and Economy, Ch 6 (practise this chapter)

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Answer: (c) 2 and 4

Human capital formation means building up the knowledge, skills and capacities of people, and what is built is intangible. So statements 2 and 4 describe it, while accumulating capital or tangible wealth describes physical capital.

• ✗ 1. Accumulating more capital, in the sense of money or assets, is physical capital formation. Human capital formation is about improving people themselves.
• ✓ 2. Human capital is the specialised skills, knowledge and abilities that people bring to work. Investment in education, health and training raises them.
• ✗ 3. Tangible wealth such as machines or buildings is physical capital, which can be sold in the market like a commodity.
• ✓ 4. Human capital is intangible: it is built into the body and mind of its owner and cannot be separated from that person.

Remember · Physical capital is tangible and separable from its owner. Human capital (skills, knowledge, health) is intangible and inseparable from its owner.

📘 Read it in NCERT: Class 11 Indian Economic Development, Ch 4 (practise this chapter) · Class 8 Exploring Society: India and Beyond (Part 1), Ch 7 (practise this chapter)

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Answer: (d) high capital-output ratio

A high capital-output ratio means that a lot of capital is needed to produce each extra unit of output. Even with high saving and investment, growth then stays low because each unit of capital adds little to output.

• ✓ (d) The incremental capital-output ratio (ICOR) links investment to growth: roughly, the investment rate divided by the growth rate. India's Ninth Plan invested more than the Eighth yet grew more slowly, so its ICOR rose from 3.43 to 4.53.
• ✗ (a) Weak administration can hinder projects, but it is not the measure that ties capital formation to output. It shows up through a high capital-output ratio.
• ✗ (b) Illiteracy affects human capital and productivity in general. It is not the standard reason why saving and investment fail to raise output.
• ✗ (c) Population density is a demographic feature, not a measure of how efficiently capital is turned into output.

Remember · Growth = investment rate divided by ICOR. A high capital-output ratio means investment is inefficient, so high saving does not give proportionate output.

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Answer: (b) 2, 3 and 4 only

After 1991 India's exports, FDI inflows and foreign exchange reserves all rose sharply, while agriculture's share in GDP kept falling as industry and services grew faster. So statements 2, 3 and 4 are true and 1 is false.

• ✗ 1. The share of agriculture in GDP was on a decline, even though the workforce dependent on farming did not fall much. It did not increase.
• ✓ 2. India's share in world merchandise exports rose from 0.5 per cent in 1990 to 0.8 per cent in 2003, according to the Economic Survey 2005-06.
• ✓ 3. Opening the economy led to a rapid increase in foreign direct investment (FDI) and foreign institutional investment.
• ✓ 4. Foreign exchange reserves rose from about US $ 6 billion in 1990-91 to about US $ 646 billion in 2023-24, a very large increase.

Remember · Post-1991 India: agriculture's share in GDP fell, while exports, FDI and forex reserves rose sharply.

📘 Read it in NCERT: Class 11 Indian Economic Development, Ch 3 (practise this chapter) · Class 11 Indian Economic Development, Ch 5 (practise this chapter)

Question and answer: UPSC's official GS Paper I (2017, Series A) — paper ↗ · answer key ↗. Explanation: Minimalist IAS, checked 30 Sept 2026 (how we verify). Permalink · Report an error

Answer: (d) Neither 1 nor 2

Neither ratio rose steadily over the decade to 2016-17. The tax-to-GDP ratio hovered around 10 per cent from 2008-09 and crossed 11 per cent only in 2016-17, while the Centre's fiscal deficit jumped to 6.5 per cent of GDP in 2009-10 and then fell to 3.5 per cent by 2016-17.

• ✗ 1. The Union Budget documents for 2017-18 say the gross tax-to-GDP ratio had been stagnating in the range of 10 per cent since 2008-09; it was estimated to cross 11 per cent only in 2016-17, for the first time since 2007-08. That is stagnation and a late rise, not a steady increase.
• ✗ 2. The Centre's fiscal deficit was 6.0 per cent of GDP in 2008-09 and 6.5 per cent in 2009-10, then fell year after year to 3.5 per cent in 2016-17. The trend was downward consolidation, not a steady increase.

Remember · Tax-to-GDP stayed near 10 per cent for most of 2008-09 to 2015-16, and the Centre's fiscal deficit fell from 6.5 per cent (2009-10) to 3.5 per cent (2016-17).

Question and answer: UPSC's official GS Paper I (2017, Series A) — paper ↗ · answer key ↗. Explanation: Minimalist IAS, checked 30 Sept 2026 (how we verify). Permalink · Report an error