In December 2025, the Finance Minister called on states to manage their debt within the limits prescribed under which fiscal framework?
Correct Answer :
FRBM
Solution :
The correct option is FRBM.
Explanation:
The Fiscal Responsibility and Budget Management (FRBM) Act is the primary fiscal framework in India designed to institutionalize financial discipline, reduce fiscal deficit, and ensure long-term macro-economic stability and debt sustainability for both the Centre and the states.
Under the FRBM framework, specific limits and targets are prescribed for debt-to-GDP ratios and fiscal deficit ceilings to ensure prudent fiscal management.
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