Enacted in 2003, the Fiscal Responsibility and Budget Management (FRBM) Act aims to enhance macroeconomic stability and fiscal discipline in India by reducing deficits. The FRBM Act has significantly constrained Bihar's capacity to borrow and allocate funds, adversely impacting health and education spending. The Act has promoted economic expenditure, although it has simultaneously impeded the state's ability to provide more funds to these essential sectors. Bihar, a historically destitute state characterized by low per capita income and significant dependence on federal payments, has long suffered from insufficient financing for health facilities, medical services, educational development, and teacher recruitment. Inflexible financial targets may restrict necessary expenditures in health and education, thereby affecting service quality and human development metrics, notwithstanding the Act's promotion of resource efficiency and accountability. A significant barrier to Bihar's social and economic development is the challenge of maintaining fiscal discipline while sufficiently investing in the social sector.