gs1medium
Which one of the following was not stipulated in the Fiscal Responsibility and Budget Management Act, 2003?
- A.Elimination of revenue deficit by the end of the fiscal year 2007-08
- B.Non-borrowing by the central government from Reserve Bank of India except under certain circumstances
- C.Elimination of primary deficit by the end of the fiscal year 2008-09
- D.Fixing government guarantees in any financial year as a percentage of GDP
▶ Answer & Explanation
Correct answer: C. Elimination of primary deficit by the end of the fiscal year 2008-09
The Fiscal Responsibility and Budget Management (FRBM) Act, 2003 aimed to instill fiscal discipline, reduce the fiscal deficit, and improve macroeconomic management. While it mandated the elimination of revenue deficit and placed limits on government borrowing from the RBI, and also set targets for government guarantees, it did not specifically stipulate the elimination of primary deficit by a fixed date. The focus was primarily on revenue deficit and overall fiscal deficit.
Source: UPSC gs1 2010