Forwarded from Arthashastra Economy (Target UPSC)
#Topic_4
Escape Clause
● The Escape Clause is mentioned under Section 4(2) of the Fiscal Responsibility and Budget Management(FRBM) Act.
● The Escape Clause allows the Center to breach its fiscal deficit target by 0.5 percentage points in exceptional circumstances.
These exceptional circumstances include:
a) National security
b) war
c) National calamity
d) Collapse of agriculture
e) Structural reforms and
f)Decline in real output growth of a quarter by at least three percentage points below the average of the previous four quarters.
Escape Clause
● The Escape Clause is mentioned under Section 4(2) of the Fiscal Responsibility and Budget Management(FRBM) Act.
● The Escape Clause allows the Center to breach its fiscal deficit target by 0.5 percentage points in exceptional circumstances.
These exceptional circumstances include:
a) National security
b) war
c) National calamity
d) Collapse of agriculture
e) Structural reforms and
f)Decline in real output growth of a quarter by at least three percentage points below the average of the previous four quarters.