Q. The FRBM act is often seen in news was enacted in which of the following year?

[A] 2001

[B] 2002

[C] 2003

[D] 2004

Answer: C

Explanation: The fiscal consolidation which followed in 1991 failed to give the desired results as there was no defined mandate for it. Neither was there any statutory obligation to do so.

  • This is why the Fiscal Reforms and Budget Management Act (FRBMA) were enacted on 26 August, 2003 to provide the support of a strong institutional/statutory mechanism.
  • Designed for the purpose of medium-term management of the fiscal deficit, the FRBMA came into effect on 5 July, 2004.

Source: Ramesh Singh