Correct option is A
The borrowing requirement of the government includes interest obligations on accumulated debt. The goal of measuring primary deficit is to focus on present fiscal imbalances.
To obtain an estimate of borrowing on account of current expenditures exceeding revenues, we need to determine what has been called the primary deficit.
Primary deficit = Fiscal deficit – Interest payments or,
Primary deficit = Fiscal deficit – Net interest liabilities
Net interest liabilities consist of interest payments minus interest receipts by the government on net domestic lending.
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