Explanation:

 Under the Fiscal Responsibility and Budget Management Act (FRBMA) 2003, both the Centre and States were supposed to wipe out revenue deficit and cut fiscal deficit to 3% of GDP by 2008-09, thus bringing much needed fiscal discipline. Originally, the FRBM bill had given annual numerical targets as well. But in the process of making it a law, the annual targets were dissolved and the act simply said that the Centre will take appropriate measures to eliminate revenue deficit by March 31, 2008. The act left the annual numerical targets to be formulated by the Central Government in the form of FRBM rules under the FRBM Act 2000. However, the NDA government (which passed this act) was replaced by UPA in 2004. The UPA-I Government notified the FRBM Rules in July 2004. As Parliament is the supreme legislative body, the Act and the Rules legally bind the Finance Ministers and Governments. The key provisions of the Act as well as FRBM rules are as follows: Every year the government will bring down revenue deficit by 0.5% and eliminate it by 2007-08. Every year, the government will bring down fiscal deficit by 0.3% and bring it down to 3% by 2007-08. Total liabilities of the Union Government should not rise by more than 9% a year. Union Government would not give guarantee to loans raised by PSUs and State governments for more than 0.5% of the GDP in aggregate. Union Government would place three more documents along with the budget documents viz. Macroeconomic Framework Statement, Medium Term Fiscal Policy Statement and the Fiscal Policy Strategy Statement. At the end of second quarter, the Finance Minister would make a statement on the trend of fiscal indicators and corrective measures taken thereof. However, due to the 2007 international financial crisis, the deadlines for the implementation of the targets in the act was initially postponed and subsequently suspended in 2009. In last few years, the act has been largely neglected.