There has been a persistent deficit budget year after year. Which action/actions of the following can be taken by the Government to reduce the deficit?
1. Reducing revenue expenditure
2. Introducing new welfare schemes
3. Rationalizing subsidies
4. Reducing import duty
Select the correct answer using the code given below.

Correct Option: (c) 1 and 3 only

To reduce a persistent budget deficit, the government needs to implement fiscal consolidation measures that either reduce expenditure or increase revenues. Reducing revenue expenditure (such as administrative costs) and rationalizing subsidies directly curtail public spending. Introducing new welfare schemes and reducing import duties would instead increase expenditure and potentially lower revenue, thereby widening the deficit.