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Every year, when the Finance Minister presents the budget in Parliament, many economic terms resonate on TV and in newspapers. Such as fiscal deficit, capital expenditure, subsidy, or GDP growth. These terms often seem difficult to understand for ordinary people, but in reality, they directly impact their pockets and daily lives.

Let's understand the meaning of some important financial terms related to the budget in simple terms.

Fiscal Deficit
The difference between the government's expenditure and its income is called the fiscal deficit. If the government spends more and its income is less, it has to borrow to cover this deficit. This can impact interest rates and inflation.

Capital Expenditure
When the government spends on infrastructure projects such as roads, railways, electricity, schools, or hospitals, it is called capital expenditure. This expenditure contributes to the country's long-term growth.

Subsidy
When the government provides the public with a service at a price lower than the actual cost—such as gas cylinders, fertilizer, or food grains—it's called a subsidy. This provides relief to the common man but increases the burden on the government treasury.

Direct and Indirect Taxes
Direct taxes are those levied directly on your income, such as income tax. Indirect taxes are those you pay when purchasing goods or services, such as GST. The government derives most of its revenue from these taxes.

Disinvestment
When the government sells its stake in a public sector company (PSU), it's called disinvestment. This provides the government with cash, which it uses for development projects or to reduce the budget deficit.

Inflation and GDP
Inflation means an increase in the prices of everyday goods. GDP, or Gross Domestic Product, measures how much a country produces in a given year. If GDP is increasing, then it means that the economy is getting stronger.

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