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QUESTION PYQ 01
GS3
15 marks

Explain how the Fiscal Health Index (FHI) can be used as a tool for assessing the fiscal performance of states in India. In what way would it encourage the states to adopt prudent and sustainable fiscal policies?

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11 min
250 words

What the examiner wants

For Fiscal Health Index, explain in sequence: first, how the Fiscal Health Index (FHI) can be used as a tool for assessing the fiscal performance of states in India. In; then, what way would it encourage the states to adopt prudent and sustainable fiscal policies. Keep evidence and the conclusion tied to these exact limbs.

Explain · AssessAnswer exactly what the question asks.

Demand-wise check

  1. 1how the Fiscal Health Index (FHI) can be used as a tool for assessing the fiscal performance of states in India. In≈65 words
  2. 2what way would it encourage the states to adopt prudent and sustainable fiscal policies?≈65 words
  3. 3Use at least two question-relevant examples/evidence points to support the final judgment on Fiscal Health Index, proportionate to a 250-word answer≈65 words

Open in about 30 words and close in about 30.

Answer plan

Concept/mechanismTransmission channelOfficial evidenceGainsRisks/constraintsCalibrated policy response for Fiscal Health Index

Where marks usually go

  • Over-writing ‘how the Fiscal Health Index (FHI) can be used as a tool for assessing the fiscal…’ while reducing ‘what way would it encourage the states to adopt prudent and sustainable fiscal policies’ to a token paragraph
  • Adding correct but adjacent facts on Fiscal Health Index that do not advance the exact causal, comparative or evaluative task in this PYQ

Value addition

  • Fiscal Health Index: mechanism/value-chain diagram — input/constraint → transmission → outcome → policy lever
    → Draw it in the body, next to the point it supports.

Verified value additions

These are verified official-source additions selected for this exact PYQ. Use only the point that strengthens your argument.