UPSC Prelims Practice Questions — Capex scale-up

Q1. In the context of the Union Budget, the term 'Effective Capital Expenditure' refers to which one of the following?

  • A. The sum of the Centre's capital outlay and the grants-in-aid given to States/UTs for the creation of capital assets
  • B. Capital expenditure adjusted for inflation using the GDP deflator of the base year
  • C. The sum of the Centre's capital outlay and interest payments on past capital borrowings
  • D. The portion of capital expenditure financed exclusively through market borrowings of the Centre

Q2. With reference to the Union Budget 2026-27 vis-à-vis the previous year, consider the following statements: 1. The Centre's Capital Expenditure (BE 2026-27) is about 11.5% higher than the Revised Estimates of 2025-26. 2. Effective Capital Expenditure as a proportion of GDP is higher in BE 2026-27 than in RE 2025-26. 3. The capital outlay on Defence Services in BE 2026-27 is lower than in RE 2025-26. Which of the statements given above is/are correct?

  1. The Centre's Capital Expenditure (BE 2026-27) is about 11.5% higher than the Revised Estimates of 2025-26.
  2. Effective Capital Expenditure as a proportion of GDP is higher in BE 2026-27 than in RE 2025-26.
  3. The capital outlay on Defence Services in BE 2026-27 is lower than in RE 2025-26.
  • A. 1 only
  • B. 1 and 2 only
  • C. 2 and 3 only
  • D. 1, 2 and 3

Q3. With reference to allocations announced in the Union Budget 2026-27, consider the following Ministry-allocation pairs: 1. Ministry of Defence — about ₹7.85 lakh crore 2. Ministry of Road Transport & Highways — about ₹3.10 lakh crore 3. Ministry of Railways — about ₹2.93 lakh crore 4. Ministry of Home Affairs — about ₹15 lakh crore Which of the above pairs is/are correctly identified?

  1. Ministry of Defence — about ₹7.85 lakh crore
  2. Ministry of Road Transport & Highways — about ₹3.10 lakh crore
  3. Ministry of Railways — about ₹2.93 lakh crore
  4. Ministry of Home Affairs — about ₹15 lakh crore
  • A. 1 and 3 only
  • B. 2 and 4 only
  • C. 1, 2 and 3
  • D. 1, 2, 3 and 4

Q4. As announced in the Union Budget 2026-27, by approximately what percentage has the Centre's Capital Expenditure (BE 2026-27) been raised over the Revised Estimates of 2025-26?

  • A. About 6%
  • B. About 11.5%
  • C. About 17.6%
  • D. About 25%