CAG Report on FRBM Compliance 2023-24
Why focus: CAG findings on 57% debt-to-GDP ratio — core GS3 Economy; sets up perfect Assertion-Reason MCQs on FRBM Act compliance and deficits.
In News
What Happened
Why It Matters
Background
History & Context
What Changed
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Central Government Debt: BEFORE the post-pandemic recovery, central government debt hovered above 61 percent of GDP (in 2020-21), but NOW it has consistently declined to 57 percent of GDP by March 2024.
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Unrealised Tax Revenues: BEFORE earlier assessments where tax arrears were lower, the CAG NOW flags a massive accumulation of unrealised tax revenues amounting to over Rs 31 lakh crore.
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Interest Burden: BEFORE the current reporting period, interest payments were already a significant expenditure, and NOW the CAG specifically highlights the interest-payments-to-revenue-receipts ratio standing at a concerning 35.72 percent.
Prelims Angle
NCERT Connection
Practice Questions
Q1
Correct Statement(s)Which of the following statements is/are correct regarding the CAG Report on FRBM Compliance and India's fiscal targets? 1. The CAG reported that the central government debt increased to over 60 percent of GDP by March 2024. 2. The N.K. Singh Committee on FRBM recommended a central government debt target of 40 percent of GDP.