Karnataka's Economy, Budget and Industrial Policy — Practice

Question 1

Name the five guarantee schemes of Karnataka.

Accepted Answer

Gruha Jyothi, Gruha Lakshmi, Anna Bhagya, Shakti and Yuva Nidhi.

Question 2

What does KIADB do?

Accepted Answer

It acquires and develops industrial land for the state.

Question 3

Distinguish revenue expenditure from capital expenditure with examples.

Accepted Answer

Revenue expenditure covers recurring costs such as salaries, interest and subsidies. Capital expenditure creates assets such as roads, irrigation works and buildings, so it builds future capacity.

Question 4

Give three reasons Bengaluru became India's IT and biotechnology hub.

Accepted Answer

A public-sector science base of institutions such as ISRO and the Indian Institute of Science; a large pool of engineering and English-speaking talent; and early state policy support for software parks and biotechnology.

Question 5

Evaluate the five guarantee schemes for Karnataka's finances.

Accepted Answer

The schemes support household income, food, power, women's mobility and young people's job search, and they raise consumption. They are large recurring revenue expenditures, so they squeeze capital spending unless revenue grows or other subsidies are cut. Delivery gaps have been reported, so benefits do not always reach the intended households. A balanced view welcomes the welfare gain while asking for targeting, review and protected capital investment.

Question 6

How can industrial policy reduce Karnataka's regional imbalance?

Accepted Answer

By locating industrial land and clusters outside Bengaluru through KIADB, giving sector incentives for districts that lag, building corridors with roads and power, and training local workers. The constraints are water, land, power and skills, so each policy must be matched with infrastructure for the target region.

Question 7

Explain fiscal deficit and debt and why they are different.

Accepted Answer

Fiscal deficit is the gap between total expenditure and receipts excluding borrowing in one year, a flow. Debt is the total borrowing accumulated over years, a stock. A state can cut its deficit and still carry a large debt.

Question 8

Name two sources of the state's own tax revenue.

Accepted Answer

Stamp duty and registration, state excise, motor vehicle tax and the state's share of GST.

Practice — Karnataka's Economy, Budget and Industrial Policy

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