Q. If a credit rating agency revises India’s real GDP growth projections upward, then which one of the following impacts can be observed on India’s fiscal policy?
Answer: B
Notes:
Explanation – An upward revision in GDP growth projections generally indicates a stronger economic outlook. This can lead to increased government revenues through higher tax collections due to improved economic activity. With more resources at its disposal, the government may have greater flexibility to increase public spending on infrastructure, social programs, and other development initiatives without significantly affecting fiscal deficits. This approach can further stimulate economic growth and support long-term development goals.
Source: AIR
