Consider the following statements : The 'Stability and Growth Pact' of the European Union is a treaty that 1. limits the levels of the budgetary deficit of the countries of the European Union 2. makes the countries of the European Union to share their infrastructure facilities 3. enables the countries of the European Union to share their technologies How many of the above statements are correct?
- (a) Only one ✓ UPSC's answer
- (b) Only two
- (c) All three
- (d) None
Why the answer is (a)
• The Stability and Growth Pact (1997) is the EU's fiscal rulebook for members, especially those using the euro.
• Statement 1 is correct: it limits budget deficits to 3% of GDP and public debt to 60% of GDP, with corrective procedures for breaches.
• Statements 2 and 3 are wrong: the Pact has nothing to do with sharing infrastructure or technology; those are handled by separate EU programmes such as the Connecting Europe Facility and Horizon Europe.
• The rules were suspended during the pandemic and reformed in 2024.
• Hence only one, option (a).
Why the other options are wrong
- (b) Only two
- Only the deficit-limit statement is correct.
- (c) All three
- Statements 2 and 3 are unrelated to the Pact.
- (d) None
- Statement 1 on deficit limits is correct.
Asked in the GS Paper I of the UPSC Civil Services Preliminary Examination 2023, held on 28 May 2023. Question and answer key: Union Public Service Commission. Explanation: UPSC Answer Check.