{"id":91534,"date":"2025-06-01T10:59:32","date_gmt":"2025-06-01T10:59:32","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=91534"},"modified":"2025-06-01T10:59:32","modified_gmt":"2025-06-01T10:59:32","slug":"consider-the-following-statements-1-the-fiscal-responsibility-and","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/consider-the-following-statements-1-the-fiscal-responsibility-and\/","title":{"rendered":"Consider the following statements:\n  1. The Fiscal Responsibility and"},"content":{"rendered":"<p>Consider the following statements:<\/p>\n<ul>\n<li>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.<\/li>\n<li>2. The Central Government has domestic liabilities of 21% of GDP as compared to that of 49% of GDP of the State Governments.<\/li>\n<li>3. As per the Constitution of India, it is mandatory for a State to take the Central Government&#8217;s consent for raising any loan if the former owes any outstanding liabilities to the latter.<\/li>\n<\/ul>\n<p>Which of the statements given above is\/are correct ?<\/p>\n<p>[amp_mcq option1=&#8221;1 only&#8221; option2=&#8221;2 and 3 only&#8221; option3=&#8221;1 and 3 only&#8221; option4=&#8221;1, 2 and 3&#8243; correct=&#8221;option3&#8243;]<\/p>\n<div class=\"psc-box-pyq-exam-year-detail\">\n<div class=\"pyq-exam\">\n<div class=\"psc-heading\">This question was previously asked in<\/div>\n<div class=\"psc-title line-ellipsis\">UPSC IAS &#8211; 2018<\/div>\n<\/div>\n<div class=\"pyq-exam-psc-buttons\"><a href=\"\/pyq\/pyq-upsc-ias-2018.pdf\" target=\"_blank\" class=\"psc-pdf-button\" rel=\"noopener\">Download PDF<\/a><a href=\"\/pyq-upsc-ias-2018\" target=\"_blank\" class=\"psc-attempt-button\" rel=\"noopener\">Attempt Online<\/a><\/div>\n<\/div>\n<section id=\"pyq-correct-answer\">\nStatement 1 is correct. The Fiscal Responsibility and Budget Management (FRBM) Review Committee headed by N.K. Singh recommended a debt-to-GDP ratio of 60% for the general government (Centre + States) by 2023, with a break-up of 40% for the Central Government and 20% for the State Governments.<br \/>\nStatement 2 is incorrect. As per government data around the time this question would be relevant (e.g., pre-pandemic years), the Central Government&#8217;s liabilities were significantly higher than 21% of GDP and also higher than the State Governments&#8217; liabilities. State Governments&#8217; total outstanding liabilities were typically around 25-30% of GDP, while the Centre&#8217;s liabilities were closer to 50-55% of GDP. The statement provides figures that are roughly the opposite of the actual situation.<br \/>\nStatement 3 is correct. Article 293(3) of the Constitution of India states that a State may not, without the consent of the Government of India, raise any loan if there is still outstanding any part of a loan which has been made to the State by the Government of India or by its predecessor Government, or in respect of which a guarantee has been given by the Government of India. This makes the Centre&#8217;s consent mandatory for states indebted to the Centre before raising further loans.<br \/>\n<\/section>\n<section id=\"pyq-key-points\">\n&#8211; The N.K. Singh FRBM Review Committee recommended specific debt-to-GDP targets for the Centre and States.<br \/>\n&#8211; Central government liabilities are typically higher than State government liabilities as a percentage of GDP.<br \/>\n&#8211; States need Central government&#8217;s consent to raise loans if they have outstanding loans from the Centre.<br \/>\n<\/section>\n<section id=\"pyq-additional-information\">\nThe debt-to-GDP ratio is a key indicator of fiscal health. High debt levels can constrain government spending and increase vulnerability to economic shocks. The FRBM Act aims to ensure fiscal discipline.<br \/>\n<\/section>\n","protected":false},"excerpt":{"rendered":"<p>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 &#8230; <\/p>\n<p class=\"read-more-container\"><a title=\"Consider the following statements:\n  1. The Fiscal Responsibility and\" class=\"read-more button\" href=\"https:\/\/exam.pscnotes.com\/mcq\/consider-the-following-statements-1-the-fiscal-responsibility-and\/#more-91534\">Detailed Solution<span class=\"screen-reader-text\">Consider the following statements:<br \/>\n  1. The Fiscal Responsibility and<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1092],"tags":[1114,1120,1196],"class_list":["post-91534","post","type-post","status-publish","format-standard","hentry","category-upsc-ias","tag-1114","tag-economic-development","tag-fiscal-policy-revenue","no-featured-image-padding"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.2 (Yoast SEO v23.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Consider the following statements:  1. The Fiscal Responsibility and<\/title>\n<meta name=\"description\" content=\"Statement 1 is correct. The Fiscal Responsibility and Budget Management (FRBM) Review Committee headed by N.K. Singh recommended a debt-to-GDP ratio of 60% for the general government (Centre + States) by 2023, with a break-up of 40% for the Central Government and 20% for the State Governments. Statement 2 is incorrect. As per government data around the time this question would be relevant (e.g., pre-pandemic years), the Central Government&#039;s liabilities were significantly higher than 21% of GDP and also higher than the State Governments&#039; liabilities. State Governments&#039; total outstanding liabilities were typically around 25-30% of GDP, while the Centre&#039;s liabilities were closer to 50-55% of GDP. The statement provides figures that are roughly the opposite of the actual situation. Statement 3 is correct. Article 293(3) of the Constitution of India states that a State may not, without the consent of the Government of India, raise any loan if there is still outstanding any part of a loan which has been made to the State by the Government of India or by its predecessor Government, or in respect of which a guarantee has been given by the Government of India. This makes the Centre&#039;s consent mandatory for states indebted to the Centre before raising further loans. - The N.K. Singh FRBM Review Committee recommended specific debt-to-GDP targets for the Centre and States. - Central government liabilities are typically higher than State government liabilities as a percentage of GDP. - States need Central government&#039;s consent to raise loans if they have outstanding loans from the Centre.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/exam.pscnotes.com\/mcq\/consider-the-following-statements-1-the-fiscal-responsibility-and\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Consider the following statements:  1. The Fiscal Responsibility and\" \/>\n<meta property=\"og:description\" content=\"Statement 1 is correct. The Fiscal Responsibility and Budget Management (FRBM) Review Committee headed by N.K. Singh recommended a debt-to-GDP ratio of 60% for the general government (Centre + States) by 2023, with a break-up of 40% for the Central Government and 20% for the State Governments. Statement 2 is incorrect. As per government data around the time this question would be relevant (e.g., pre-pandemic years), the Central Government&#039;s liabilities were significantly higher than 21% of GDP and also higher than the State Governments&#039; liabilities. State Governments&#039; total outstanding liabilities were typically around 25-30% of GDP, while the Centre&#039;s liabilities were closer to 50-55% of GDP. The statement provides figures that are roughly the opposite of the actual situation. Statement 3 is correct. Article 293(3) of the Constitution of India states that a State may not, without the consent of the Government of India, raise any loan if there is still outstanding any part of a loan which has been made to the State by the Government of India or by its predecessor Government, or in respect of which a guarantee has been given by the Government of India. This makes the Centre&#039;s consent mandatory for states indebted to the Centre before raising further loans. - The N.K. Singh FRBM Review Committee recommended specific debt-to-GDP targets for the Centre and States. - Central government liabilities are typically higher than State government liabilities as a percentage of GDP. - States need Central government&#039;s consent to raise loans if they have outstanding loans from the Centre.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/exam.pscnotes.com\/mcq\/consider-the-following-statements-1-the-fiscal-responsibility-and\/\" \/>\n<meta property=\"og:site_name\" content=\"MCQ and Quiz for Exams\" \/>\n<meta property=\"article:published_time\" content=\"2025-06-01T10:59:32+00:00\" \/>\n<meta name=\"author\" content=\"rawan239\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"rawan239\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"Consider the following statements:  1. The Fiscal Responsibility and","description":"Statement 1 is correct. The Fiscal Responsibility and Budget Management (FRBM) Review Committee headed by N.K. Singh recommended a debt-to-GDP ratio of 60% for the general government (Centre + States) by 2023, with a break-up of 40% for the Central Government and 20% for the State Governments. Statement 2 is incorrect. As per government data around the time this question would be relevant (e.g., pre-pandemic years), the Central Government's liabilities were significantly higher than 21% of GDP and also higher than the State Governments' liabilities. State Governments' total outstanding liabilities were typically around 25-30% of GDP, while the Centre's liabilities were closer to 50-55% of GDP. The statement provides figures that are roughly the opposite of the actual situation. Statement 3 is correct. Article 293(3) of the Constitution of India states that a State may not, without the consent of the Government of India, raise any loan if there is still outstanding any part of a loan which has been made to the State by the Government of India or by its predecessor Government, or in respect of which a guarantee has been given by the Government of India. This makes the Centre's consent mandatory for states indebted to the Centre before raising further loans. - The N.K. Singh FRBM Review Committee recommended specific debt-to-GDP targets for the Centre and States. - Central government liabilities are typically higher than State government liabilities as a percentage of GDP. - States need Central government's consent to raise loans if they have outstanding loans from the Centre.","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/exam.pscnotes.com\/mcq\/consider-the-following-statements-1-the-fiscal-responsibility-and\/","og_locale":"en_US","og_type":"article","og_title":"Consider the following statements:  1. The Fiscal Responsibility and","og_description":"Statement 1 is correct. The Fiscal Responsibility and Budget Management (FRBM) Review Committee headed by N.K. Singh recommended a debt-to-GDP ratio of 60% for the general government (Centre + States) by 2023, with a break-up of 40% for the Central Government and 20% for the State Governments. Statement 2 is incorrect. As per government data around the time this question would be relevant (e.g., pre-pandemic years), the Central Government's liabilities were significantly higher than 21% of GDP and also higher than the State Governments' liabilities. State Governments' total outstanding liabilities were typically around 25-30% of GDP, while the Centre's liabilities were closer to 50-55% of GDP. The statement provides figures that are roughly the opposite of the actual situation. Statement 3 is correct. Article 293(3) of the Constitution of India states that a State may not, without the consent of the Government of India, raise any loan if there is still outstanding any part of a loan which has been made to the State by the Government of India or by its predecessor Government, or in respect of which a guarantee has been given by the Government of India. This makes the Centre's consent mandatory for states indebted to the Centre before raising further loans. - The N.K. Singh FRBM Review Committee recommended specific debt-to-GDP targets for the Centre and States. - Central government liabilities are typically higher than State government liabilities as a percentage of GDP. - States need Central government's consent to raise loans if they have outstanding loans from the Centre.","og_url":"https:\/\/exam.pscnotes.com\/mcq\/consider-the-following-statements-1-the-fiscal-responsibility-and\/","og_site_name":"MCQ and Quiz for Exams","article_published_time":"2025-06-01T10:59:32+00:00","author":"rawan239","twitter_card":"summary_large_image","twitter_misc":{"Written by":"rawan239","Est. reading time":"2 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/exam.pscnotes.com\/mcq\/consider-the-following-statements-1-the-fiscal-responsibility-and\/","url":"https:\/\/exam.pscnotes.com\/mcq\/consider-the-following-statements-1-the-fiscal-responsibility-and\/","name":"Consider the following statements: 1. The Fiscal Responsibility and","isPartOf":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/#website"},"datePublished":"2025-06-01T10:59:32+00:00","dateModified":"2025-06-01T10:59:32+00:00","author":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/#\/schema\/person\/5807dafeb27d2ec82344d6cbd6c3d209"},"description":"Statement 1 is correct. The Fiscal Responsibility and Budget Management (FRBM) Review Committee headed by N.K. Singh recommended a debt-to-GDP ratio of 60% for the general government (Centre + States) by 2023, with a break-up of 40% for the Central Government and 20% for the State Governments. Statement 2 is incorrect. As per government data around the time this question would be relevant (e.g., pre-pandemic years), the Central Government's liabilities were significantly higher than 21% of GDP and also higher than the State Governments' liabilities. State Governments' total outstanding liabilities were typically around 25-30% of GDP, while the Centre's liabilities were closer to 50-55% of GDP. The statement provides figures that are roughly the opposite of the actual situation. Statement 3 is correct. Article 293(3) of the Constitution of India states that a State may not, without the consent of the Government of India, raise any loan if there is still outstanding any part of a loan which has been made to the State by the Government of India or by its predecessor Government, or in respect of which a guarantee has been given by the Government of India. This makes the Centre's consent mandatory for states indebted to the Centre before raising further loans. - The N.K. Singh FRBM Review Committee recommended specific debt-to-GDP targets for the Centre and States. - Central government liabilities are typically higher than State government liabilities as a percentage of GDP. - States need Central government's consent to raise loans if they have outstanding loans from the Centre.","breadcrumb":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/consider-the-following-statements-1-the-fiscal-responsibility-and\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/exam.pscnotes.com\/mcq\/consider-the-following-statements-1-the-fiscal-responsibility-and\/"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/exam.pscnotes.com\/mcq\/consider-the-following-statements-1-the-fiscal-responsibility-and\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/exam.pscnotes.com\/mcq\/"},{"@type":"ListItem","position":2,"name":"UPSC IAS","item":"https:\/\/exam.pscnotes.com\/mcq\/category\/upsc-ias\/"},{"@type":"ListItem","position":3,"name":"Consider the following statements: 1. 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