FRBM Review Committee

The five-member committee handed over its report by late January 2017. Though the report is yet to be put in the public domain, meanwhile, some important clues to its recommendations have been outlined by the Union Budget 2017-18 as given below:

• It has done an elaborate exercise and has recommended that a sustainable debt path must be the principal macro-economic anchor of

our fiscal policy.

• It has favoured Debt to GDP of 60 per cent for the General Government by 2023— consisting of 40 per cent for Central Government and 20 per cent for State Governments.

• Within the framework of debt to GDP ratio, it has derived and recommended 3 per cent fiscal deficit for the next three years.

• It has also provided for Escape Clauses, for deviations upto 0.5 per cent of GDP, from the stipulated fiscal deficit target. Among the triggers for taking recourse to these Escape Clauses, it has included “far-reaching structural reforms in the economy with unanticipated fiscal implications” as one of the factors.

The budget has informed that the report will be carefully examined and appropriate decisions will be taken on its advices in due course.