Hayat Ashraf

Fiscal policy refers to the use of government spending, taxation, and borrowing to influence the overall health and direction of the economy. In the Indian economy, fiscal policy is formulated and implemented by the central government to achieve various objectives, such as promoting economic growth, controlling inflation, reducing unemployment, and addressing socio-economic challenges. Here's an overview of fiscal policy in the Indian economy: 1. Expansionary Fiscal Policy:    a. Increasing Government Spending: The government can increase its expenditure on infrastructure development, education, healthcare, social welfare programs, and other sectors to stimulate economic activity and boost aggregate demand.    b. Tax Cuts: Reducing tax rates or providing tax incentives to individuals and businesses can increase disposable income, encourage consumption and investment, and stimulate economic growth.    c. Deficit Financing: The government may resort to defici...