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The Fiscal Responsibility and Budget Management (FRBM) Act was enacted in 2003 which set targets for the government to reduce fiscal deficits and strengthen financial discipline and fiscal prudence. Hence, statement 1 is correct. The N.K. Singh panel to review India’s fiscal discipline rules has recommended a debt-to-GDP ratio of 38.7% for the central government, 20% for the state governments together and a fiscal deficit of 2.5% of GDP (Gross Domestic Product), both by financial year 2022-23. The Fiscal Responsibility and Budget Management Bill (FRBM Bill) was introduced in India by the then Finance Minister of India, Mr.Yashwant Sinha.
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