IDEAS home Printed from https://ideas.repec.org/p/anf/wpaper/23.html
   My bibliography  Save this paper

Understanding deviations from the fiscal responsibility law in India

Author

Listed:
  • Pratik Datta

    (Shardul Amarchand Mangaldas & Co.)

  • Radhika Pandey

    (NIPFP)

  • Ila Patnaik

    (Aditya Birla Group)

  • Ajay Shah

    (xKDR Forum)

Abstract

The Parliament enacted the Fiscal Responsibility and Budget Management Act (FRBM Act) in 2003. In most of the following years, union public finance has deviated from the strictures of the law. Was it poor drafting of the statutory escape clause in the FRBM Act, 2003 that led to these deviations? We show that this is not the correct diagnosis. The escape clause that flows from the Constitution of India - the special procedure for money bills - gives the union government the ability to get around shackles placed under Parliamentary legislation. If fiscal rules are sought to be implemented through laws, the legal strategy needs to take this constitutional framework into account.

Suggested Citation

  • Pratik Datta & Radhika Pandey & Ila Patnaik & Ajay Shah, 2023. "Understanding deviations from the fiscal responsibility law in India," Working Papers 23, xKDR.
    • Handle: RePEc:anf:wpaper:23
    as

    Download full text from publisher

    File URL: https://papers.xkdr.org/papers/dattaPandeyPatnaikShah2023_frbm.pdf
    File Function: First version, 2023
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Ian Lienert & Israel Fainboim Yaker, 2010. "Reforming Budget System Laws," IMF Technical Notes and Manuals 2010/01, International Monetary Fund.
    2. Ian Lienert & Israel Fainboim Yaker, 2010. "Reforming Budget System Laws," IMF Technical Notes and Manuals 10/01, International Monetary Fund.
    3. Israel Fainboim Yaker & Mr. Ian Lienert, 2010. "Reforming Budget System Laws," IMF Technical Notes and Manuals 2010/001, International Monetary Fund.
    4. Mr. Ian Lienert, 2005. "Who Controls the Budget: The Legislature or the Executive?," IMF Working Papers 2005/115, International Monetary Fund.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Kaur, Amandeep & Jha, Ajay Narayan & Chakraborty, Lekha, 2023. "G20 and Climate Responsive Budgeting," Working Papers 23/401, National Institute of Public Finance and Policy.
    2. Charmi Mehta & Radhika Pandey & Renuka Sane & Ajay Shah, 2024. "The electricity chokepoint in Tamil Nadu public finance," Working Papers 31, xKDR.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Mihaela Onofrei & Anca Florentina Vatamanu & Elena Cigu & Florin Oprea, 2020. "Fiscal-budgetary responsibility and implications on the European budgetary framework in the context of the COVID-19 crisis," Journal of Financial Studies, Institute of Financial Studies, vol. 9(5), pages 24-34, November.
    2. Abidemi C. Adegboye & Joel Edafe & Samuel Iweriebor, 2016. "Budget And Political Institutions And Budgetary Performance," Oradea Journal of Business and Economics, University of Oradea, Faculty of Economics, vol. 1(2), pages 72-82, September.
    3. World Bank, 2008. "Costa Rica - Public Expenditure Review : Enhancing the Efficiency of Expenditures," World Bank Publications - Reports 8122, The World Bank Group.
    4. Joachim Wehner, 2006. "Assessing the Power of the Purse: An Index of Legislative Budget Institutions," Political Studies, Political Studies Association, vol. 54(4), pages 767-785, December.
    5. Antonio Di Majo, 2020. "Budgeting pubblico, democrazia di bilancio, governo delle finanze pubbliche: la storia di una complessa interazione (Public budgeting, budet democracy, and public finances governance: History of a com," Moneta e Credito, Economia civile, vol. 73(291), pages 237-259.
    6. Robert Liebenthal & Caesar Cheelo, 2018. "Understanding the implications of the boom-bust cycle of global copper prices for natural resources, structural change, and industrial development in Zambia," WIDER Working Paper Series 166, World Institute for Development Economic Research (UNU-WIDER).
    7. Antonio Di Majo, 2020. "Democrazia di Bilancio e Governo delle Finanze pubbliche nella storia del Budgeting pubblico," Working papers 86, Società Italiana di Economia Pubblica.
    8. Martin Gregor, 2008. "Rozpočtová pravidla a rozpočtový proces: Teorie, empirie a realita České republiky [Budgetary rules and budget process: Theory, empirics, and the case of the Czech Republic]," Politická ekonomie, Prague University of Economics and Business, vol. 2008(4), pages 484-504.
    9. repec:jle:journl:125 is not listed on IDEAS
    10. Taiabur Rahman & Lamia Mohsin, 2022. "Parliamentary Power of the Purse: Stocktaking the Role of the Jatiya Sangsad in the Budgetary Process in Bangladesh," Public Organization Review, Springer, vol. 22(4), pages 1217-1236, December.
    11. Mr. Ian Lienert, 2007. "British Influences on Commonwealth Budget Systems: The Case of the United Republic of Tanzania," IMF Working Papers 2007/078, International Monetary Fund.
    12. Barry Eichengreen, 2010. "The Breakup of the Euro Area," NBER Chapters, in: Europe and the Euro, pages 11-51, National Bureau of Economic Research, Inc.
    13. Hoyong Jung, 2022. "Online Open Budget: The Effects of Budget Transparency on Budget Efficiency," Public Finance Review, , vol. 50(1), pages 91-119, January.
    14. Daniela Mardiros & Roxana Dicu & Leontina Pavaloaia & Gabriel Chelariu, 2017. "The Budgetary Implementation on Main Components of Romania's General Consolidated State Budget," EuroEconomica, Danubius University of Galati, issue 1(36), pages 7-20, May.
    15. Afrah Junita & Erlina & Erwin Abubakar & Syukriy Abdullah, 2018. "The Effect of Budget Variances on the Local Government Budget Changes with Legislature Size as Moderator," Academic Journal of Economic Studies, Faculty of Finance, Banking and Accountancy Bucharest,"Dimitrie Cantemir" Christian University Bucharest, vol. 4(1), pages 162-173, March.
    16. Georgios Moschovis, 2010. "Public Spending Allocation, Fiscal Performance and Corruption," Economic Papers, The Economic Society of Australia, vol. 29(1), pages 64-79, March.
    17. Emmanuel Botlhale, 2013. "Extending Budgetary Participation beyond Budget Pitsos in Botswana," Development Policy Review, Overseas Development Institute, vol. 31(6), pages 717-735, November.
    18. Luisa Giuriato & Alessandra Cepparulo & Matteo Barberi, 2016. "Fiscal forecasts and political systems: a legislative budgeting perspective," Public Choice, Springer, vol. 168(1), pages 1-22, July.
    19. Ian Lienert, 2013. "Fiscal Responsibility Laws: Are They Needed?," Journal of International Commerce, Economics and Policy (JICEP), World Scientific Publishing Co. Pte. Ltd., vol. 4(03), pages 1-32.
    20. Hallerberg, Mark & Wolff, Guntram B., 2006. "Fiscal institutions, fiscal policy and sovereign risk premia," Discussion Paper Series 1: Economic Studies 2006,35, Deutsche Bundesbank.

    More about this item

    JEL classification:

    • H6 - Public Economics - - National Budget, Deficit, and Debt
    • K3 - Law and Economics - - Other Substantive Areas of Law
    • O2 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:anf:wpaper:23. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Ami Dagli (email available below). General contact details of provider: https://www.papers.xkdr.org/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.