Expected Questions from Union Budget 2025-26: Attempt Free Quiz Here

Correct Answer:  (b) ₹50,65,345 crore

Explanation:  The Union Budget for 2025-26, presented by Finance Minister Nirmala Sitharaman, proposed a total expenditure of ₹50,65,345 crore. This reflects a significant increase compared to previous budgets, focusing on infrastructure development, social welfare schemes, and defense modernization. The budget aims to boost economic growth while maintaining fiscal discipline.

• Key allocations include higher spending on capital expenditure (capex) to stimulate job creation and economic activity, increased outlays for health and education, and continued support for flagship schemes like PM-KISAN and MGNREGA. The budget also emphasizes green energy initiatives and digital infrastructure.
• This expenditure is part of the government’s strategy to sustain India’s position as one of the fastest-growing major economies while addressing inflation and global economic uncertainties. The fiscal deficit is targeted to be reduced gradually, ensuring long-term macroeconomic stability.

Thus, the correct answer is (b) ₹50,65,345 crore, as officially announced in the Union Budget 2025-26.

Correct Answer:  (c) Borrowings & Other Liabilities

Explanation:  Borrowings & Other Liabilities account for 24% of the government’s revenue, which is the largest source among all categories mentioned. While GST, Income Tax, and Corporation Tax are major revenue sources, Borrowings & Other Liabilities (which include loans and bonds issued by the government) account for the highest share in the government’s total funding. This is because India runs a fiscal deficit, meaning expenditures exceed revenues, requiring borrowing to bridge the gap.

Dividend is estimated to form 55.7% of the total budgeted non-tax receipts for 2025-26. Capital receipts (excluding borrowings) are targeted at Rs 76,000 crore, an increase of 28.8% over the revised estimates for 2024-25. The revised estimates for 2024-25 are 24.4% lower than the budgeted amount for that year.

Correct Answer:  (d) 4.4%

Explanation:  In the Union Budget 2025-26, the government has set a fiscal deficit target of 4.4% of GDP, continuing its gradual reduction from previous years. This aligns with India’s medium-term fiscal consolidation roadmap, aiming to balance growth-supporting expenditures with fiscal discipline.

Key Reasons:

1. Economic Growth Priority: The government is maintaining higher spending on infrastructure and welfare schemes to sustain growth, justifying a deficit above pre-pandemic levels (which was around 3-3.5%).
2. Debt Sustainability: A 4.4% deficit ensures borrowing remains manageable while funding critical investments.
3. Global Comparisons: Many economies run deficits post-pandemic, and India’s target is prudent compared to higher deficits in developed nations.

Correct Answer:  (b) ₹6,81,210.27 crore

Explanation:  The correct answer is (b) ₹6,81,210.27 crore, as allocated to the Defence sector in the Union Budget 2025-26.

Key Details:

1. Highest-Ever Allocation: This marks a significant increase from previous budgets, reflecting India’s focus on modernizing armed forces, indigenous defense production (Atmanirbhar Bharat), and border infrastructure.
2. Breakdown:
   • Capital Expenditure (for new weapons, aircraft, and naval systems) saw a major hike.
   • Revenue Expenditure (salaries, pensions, maintenance) also rose.
3. Strategic Priorities: Funds will bolster cybersecurity, drone technology, and the defense-industrial ecosystem.

Correct Answer:  (c) Ministry of Finance

Explanation:  ​The correct answer is (c) Ministry of Finance. In the Union Budget for the fiscal year 2025-26, the Ministry of Finance received the highest allocation of ₹19.39 lakh crore. This substantial allocation underscores the ministry’s central role in managing the nation’s economic policies, financial regulations, and revenue systems. Following the Ministry of Finance, the Ministry of Defence was allocated ₹6.81 lakh crore, reflecting the government’s commitment to national security and defense modernization. Other significant allocations include the Ministry of Road Transport and Highways with ₹2.87 lakh crore, the Ministry of Railways with ₹2.55 lakh crore, and the Ministry of Home Affairs with ₹2.33 lakh crore. These allocations highlight the government’s focus on infrastructure development and internal security.

Correct Answer:  (d) ₹63,500 crore

Explanation:  ​The correct answer is (d) ₹63,500 crore. In the Union Budget for the fiscal year 2025-26, the government has allocated ₹63,500 crore to the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) scheme. This represents a 5.8% increase from the previous year’s allocation of ₹60,000 crore. PM-KISAN is a central sector scheme launched on December 1, 2018, aiming to provide financial assistance to all landholding farmer families across the country. Under this scheme, eligible farmers receive ₹6,000 annually in three equal installments of ₹2,000 each, directly transferred into their bank accounts. The increased allocation underscores the government’s commitment to supporting farmers’ income and ensuring the sustainability of the agricultural sector.

Correct Answer:  (e) 20%

Explanation:  ​The correct answer is (e) 20%. In the Union Budget for the fiscal year 2025-26, the government’s gross tax revenue is projected at ₹42.70 lakh crore. The revenue from personal income tax is estimated at ₹14.38 lakh crore, which constitutes approximately 33.7% of the gross tax revenue. However, after accounting for tax devolution to states, the central government’s net tax revenue stands at ₹28.37 lakh crore. Consequently, the personal income tax contributes about 20% to the central government’s net tax revenue. This significant portion underscores the importance of personal income tax in financing the government’s expenditures and developmental initiatives.

Correct Answer:  (b) ₹34,20,409 crore

Explanation:  ​The correct answer is (b) ₹34,20,409 crore. In the Union Budget for the fiscal year 2025-26, the government’s total revenue receipts are projected at ₹34,20,409 crore. This figure represents an 11.1% increase over the revised estimates for 2024-25, reflecting the government’s anticipation of higher tax and non-tax revenues in the upcoming fiscal year. The revenue receipts comprise net tax revenue of ₹28,37,409 crore and non-tax revenue of ₹5,83,000 crore. This projected growth in revenue receipts is expected to support the government’s planned total expenditure of ₹50,65,345 crore for 2025-26, aiming to fuel economic growth and development initiatives.

Correct Answer:  (c) ₹1,28,650 crore

Explanation:  ​The correct answer is (c) ₹1,28,650 crore. In the Union Budget for the fiscal year 2025-26, the Indian government has allocated ₹1,28,650 crore to the education sector, marking a 6.65% increase from the previous year’s allocation of ₹1,14,000 crore. This allocation is divided between the Department of School Education and Literacy, which received ₹78,572 crore (61% of the total education budget), and the Department of Higher Education, which was allotted ₹50,078 crore (39% of the total). The increased funding underscores the government’s commitment to enhancing both school and higher education infrastructures, supporting initiatives such as the establishment of 50,000 Atal Tinkering Labs in government schools and the expansion of capacities in Indian Institutes of Technology (IITs) and medical colleges.

Correct Answer:  (b) 1.5%

Explanation:  ​The correct answer is (b) 1.5%. In the Union Budget for the fiscal year 2025-26, India’s revenue deficit is projected at 1.5% of the Gross Domestic Product (GDP). This marks a reduction from the revised estimate of 1.9% in the previous fiscal year, reflecting the government’s commitment to fiscal consolidation. The revenue deficit represents the shortfall between the government’s revenue receipts and its revenue expenditures, indicating the extent to which the government relies on borrowed funds to meet its operational expenses. A lower revenue deficit suggests improved fiscal health, as it implies a lesser dependence on borrowing for day-to-day expenditures. This reduction aligns with the government’s broader strategy to enhance economic stability and ensure sustainable growth.​