Examine the fiscal framework established under the 'Fiscal Responsibility and Budget Management (FRBM) Act, 2003'. Which committee recommended a debt-to-GDP ratio target of 40 percent for the central government?

💡 Solution & Explanation

The Committee to Review the FRBM Act, headed by N.K. Singh, recommended that the central government target a fiscal deficit of 3 percent of GDP and a combined debt-to-GDP ratio of 60 percent, with 40 percent for the Centre and 20 percent for states. The Urjit Patel committee focused on revising and strengthening the monetary policy framework and inflation-targeting regime. Vijay Kelkar committee reviewed tax reforms and fiscal consolidation roadmaps in previous years. Bimal Jalan committee examined the economic capital framework of the Reserve Bank of India.