What is fiscal deficit?

Suppose you have 100 rupees, and you decide to spend 5 rupees everyday on a small candy bar. How much money will you need in a month? 150 rupees. But we only have 100! The 50 rupees that we want to spend, but don’t actually have, is called the deficit.

The government makes its money from taxing people. In turn, it spends on things like roads, hospitals, etc.

But the government also spends more than it has. The difference between the government’s earning and its expenses is called the Fiscal Deficit.