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The FRBM Review Committee (N.K. Singh, 2017) recommended which anchor as the main medium-term target for fiscal policy?
The N.K. Singh FRBM Review Committee recommended the debt-to-GDP ratio as the key medium-term fiscal anchor, with the fiscal deficit path serving as the operational target. This shifted focus from deficits alone to overall debt sustainability.
- ARevenue deficit fixed at zero
- BPrimary deficit at 5 percent of GDP
- CDebt-to-GDP ratio, with a fiscal deficit path as the operational targetCorrect
- DTax-to-GDP ratio of 25 percent
Explanation
The committee proposed the debt-to-GDP ratio as the principal anchor, with fiscal deficit as an operating target to reach it. Zero revenue deficit was an earlier FRBM approach, and the other figures were not its recommendations.
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