A Review of the FRBM Act

31 Pages Posted: 7 Jun 2017

See all articles by Charan Singh

Charan Singh

Indian Institute of Management (IIMB), Bangalore

P R Devi Prasad

Independent

K.K. Sharma

Government of Karnataka

Shivakumara K

Indian Institute of Management (IIMB), Bangalore

Date Written: June 5, 2017

Abstract

The Fiscal Responsibility and Budget Management Act (FRBMA), 2003 sets fiscal rules that seek to foster fiscal discipline on the Central Government and achieving a balanced budget with effective revenue management. The Act sets targets and suggests means of reducing fiscal and revenue deficits. It has however, had limited success. The targets that were to be achieved by 2008-09 were relaxed because of financial crisis of 2008. However, strict implementation of FRBMA has been a matter of concern. This paper notes that there is an urgent requirement for greater transparency in budget preparation, making the medium-term framework more binding and greater capacity building on the part of government to promote budgetary and debt management institutions.

Keywords: FRBMA, Medium-Term Framework, Effective Revenue Deficit, Balanced Budget

Suggested Citation

Singh, Charan and Prasad, P R Devi and Sharma, K.K. and K, Shivakumara, A Review of the FRBM Act (June 5, 2017). IIM Bangalore Research Paper No. 550, Available at SSRN: https://ssrn.com/abstract=2981526 or http://dx.doi.org/10.2139/ssrn.2981526

Charan Singh (Contact Author)

Indian Institute of Management (IIMB), Bangalore ( email )

Bannerghatta Road
Bangalore, Karnataka 560076
India
080-26993818 (Phone)

P R Devi Prasad

Independent ( email )

K.K. Sharma

Government of Karnataka ( email )

Kengeri Post, Bangalore-Mysore Road
Bangalore, 5600 60
India

Shivakumara K

Indian Institute of Management (IIMB), Bangalore ( email )

Bannerghatta Road
Bangalore, Karnataka 560076
India

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