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Q58 (IAS/2006) Economy › Government Finance & Budget › FRBM framework Answer Verified

Which one of the following statements is correct? Fiscal Responsibility and Budget Management Act (FRBMA) concerns

Result
Your answer: —  Â·  Correct: C
Explanation

The FRBM Act explicitly targets both fiscal deficit and revenue deficit as core elements of its fiscal consolidation framework. The Act set out annual reduction paths — a 0.3 percentage‑point annual reduction for fiscal deficit aiming for 3% of GDP, and a 0.5 percentage‑point annual reduction for revenue deficit aiming for about 1% by 2008–09 — showing attention to both deficits [1]. The FRBM Rules required elimination/reduction of revenue deficit by a prescribed date and mandated yearly reduction targets for both revenue and fiscal deficits, making both statutory policy objectives for the Centre [2]. The legislation also defines fiscal and revenue deficits and makes them operational targets within the medium‑term fiscal statements [3].

Sources

  1. [1] Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 5: Indian Tax Structure and Public Finance > FISCAL RESPONSIBILITY AND BUDGET MANAGEMENT ACT, 2003 > p. 115
  2. [2] https://fincomindia.nic.in/asset/doc/commission-reports/12th-FC/reports/eng/Chapter%2005.pdf
  3. [3] https://cag.gov.in/uploads/download_audit_report/2021/05_Chapter%201-061a4c47f5f39a1.92176491.pdf
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SIMILAR QUESTIONS

CDS-I · 2008 · Q110 Relevance score: 5.92

According to the provisions of the Fiscal Responsibility and Budget Management (FRBM). Act, 2003 and FRBM Rules, 2004, the Government is under obligation to present three statements before the Parliament along with the Annual Budget. Which one of the following is not one of them?

CDS-II · 2007 · Q111 Relevance score: 5.92

According to the provisions of the Fiscal Responsibility and Budget Management (FRBM). Act, 2003 and FRBM Rules, 2004, the Government is under obligation to present three statement s before the Parliament along with the Annual Budget. Which one of the following is not one of them?

IAS · 2018 · Q9 Relevance score: 5.27

Consider the following statements : 1. The Fiscal Responsibility and Budget Management (FRBM) Review Committee Report has recommended a debt to GDP ratio of 60% for the general (combined) government by 2023, comprising 40% for the Central Government and 20% for the State Governments. 2. The Central Government has domestic liabilities of 21% of GDP as compared to that of 49% of GDP of the State Governments. 3. As per the Constitution of India, it is mandatory for a State to take the Central Government's consent for raising any loan if the former owes any outstanding liabilities to the latter. Which of the statements given above is/are correct ?

IAS · 2010 · Q25 Relevance score: 3.91

Which one of the following was not stipulated in the Fiscal Responsibility and Budget Management Act, 2003 ?

CDS-II · 2020 · Q4 Relevance score: 2.33

Which one of the following statements about Indian economy during 2019-20 is not correct?