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 ?
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Answer: C. Statement 1 is correct: the N.K. Singh FRBM Review Committee (2017) recommended general government debt of 60% of GDP by 2023, with 40% for the Centre and 20% for States. Statement 2 is wrong: the figures are reversed; the Centre's liabilities are much higher than the States'. Statement 3 is correct: Article 293(3) requires a State to get the Centre's consent for a loan if it still owes the Centre money. So 1 and 3.
Watch for: Statement 2 uses real-looking numbers but swaps them between the Centre and the States.
Why the other options are wrong
- A. Wrong because statement 3 is also correct under Article 293(3).
- B. Wrong because statement 2 reverses the Centre and State figures.
- D. Wrong because statement 2 is false.
Source to check: FRBM Review Committee Report (N.K. Singh Committee), January 2017; Constitution of India, Article 293(3)
Answer from the official UPSC key. Written and fact-checked by AI against the official key. Spotted a mistake? Report it.