Q. Consider the following statements:

1. The goal of measuring primary deficit is to focus on present fiscal imbalances.
2. Net interest liabilities also consist of interest payments including interest receipts by the government on net domestic lending.

Which of the above statements is / are correct?
Answer: Only 1
Notes: Only statement 1 is correct. Measuring the primary deficit aims to focus on present fiscal imbalances, calculated as fiscal deficit minus interest payments. Statement 2 is incorrect because net interest liabilities are computed as interest payments minus interest receipts by the government on net domestic lending, not including both together.