Budget Down the years

Budget down the years

Union Budget 2010

Article 112 of the Constitution of India mandates that a financial statement of receipts and expenditures of the Union Government has to be presented before both the Houses of Parliament every financial year. This takes the form of the Union Budget, which is usually declared on the last day of February and is formally known as the 'Annual Financial Statement' of the Government. Here are some interesting facts about the Union Budget down the years - External website that opens in a new window:-

On November 26, 1947, R.K. Shanmukham Chetty presented the first Budget of Independent India (128 KB) - PDF file that opens in a new window . It was actually an interim budget.
Since 1955-56, Budget papers have been prepared in Hindi too.
Morarji Desai presented the maximum number of budgets so far - ten, two of them (1964 and 1968) on his birthday, February 29.
In 1970, Indira Gandhi, the then Prime Minister, took over the Finance portfolio as well. So far, she has been the only woman to have held this office, and presented the Budget.
Rajiv Gandhi presented the budget for 1987-88. He was the third Prime Minister to present a budget after his mother and grandfather.
In the first Budget of Independent India, the total expenditure was Rs. 193 crore, which has risen to Rs. 10, 20,838 crore in 2009 - External website that opens in a new window.

Railway Budget

The Railway Budget is presented by the Railways Minister every year prior to the presentation of the Union Budget. Since Indian Railways serve a large portion of the population, and a larger portion is impacted by the effect of freight rates on the prices of goods, this event is also keenly watched. Recently a White Paper on Indian Railways (12.3 MB) - PDF file that opens in a new window was submitted to Parliament by the Railway Ministry. Besides giving the basic information on the organizational, operational and financial performance of the Railways from 2003-04 to 2008-09, this document incorporates an analysis of the performance, highlighting the achievements and shortcomings. This exercise in introspection and analysis will form vital inputs to the Railway Budget. Previous years' Railway Budgets can be accessed at the Railway Ministry's website - External website that opens in a new window.

State Budgets

In addition to the Union Budget prepared at the Centre, each State Government presents its own State Budget. These are prepared by the respective State's Finance Minister in consultation with related Central Government departments. Similar to the norms followed at the Central Government level with regard to the execution of financial matters, the financial matters of the States are looked after by the respective State Legislatures. Previous budgets of the states can be viewed here.

The Prognosis: Key Indicators

The Mid Year Review of budget for 2009 - 2010 (2.12 MB) - PDF file that opens in a new window has indicated a turnaround of the Indian Economy, lifting to some extent the gloom cast by the global financial crisis and subsequent recessionary trend. However, rise in prices of food and essential commodities remains an area of concern for the common man and the Government alike. Government has already taken a number of measures - External website that opens in a new window to address the price rise of essential commodities. These include reducing import duties on wheat, pulses, crude petroleum and maize to zero; reducing import duties on some edible oils; import of raw sugar at zero duty under open general license (OGL) and removal of levy obligation in respect of raw/refined sugar.

The Review - External website that opens in a new window has also flagged important issues needing attention including the need to increase agricultural productivity, the need to continue with the policy of opening up the capital account in a gradual, sequenced and calibrated manner to address the long-term financing needs and at the same time guard against loss of competitiveness of exports.

Report of the Thirteenth Finance Commission - External website that opens in a new window, which was submitted to the President on 30^th Dec, 2009 (164 KB) - PDF file that opens in a new window , will provide significant inputs for the budget.

The Economic Survey of India is tabled in Parliament every year just before the Budget. It focuses on the growth achieved in the previous year and the factors that contributed to it. It is based on key economic indicators such as industrial production, food grains production, exports, imports, money supply growth and wholesale price changes. It also covers social sectors such as health, education and environment and the changes that were brought about through implementation of policies. Previous years Economic Surveys can be seen here - External website that opens in a new window.

Priorities highlighted by the Finance Minister - External website that opens in a new window at the Economic Editors' Conference also give some insights into the likely contours of the Budget. These include:-

Raising the growth rate and sustaining the momentum of the economy.
Ensuring that credit off-take to the employment generating sectors, especially agriculture, and micro and small enterprises, picks up by extending the reach of banking to the inaccessible regions of the country.
Return to the path of fiscal prudence, as soon as the current economic circumstances permit.
Creating entitlements backed by legal guarantee in those areas of the development process, where existing institutional arrangements and delivery mechanisms have so far been unsuccessful in breaking down the barriers to universal access to basic public goods and opportunities for livelihood.

Taxation

Budgetary provisions regarding direct and indirect taxes evoke wide interest, as these have the greatest visible impact across the board. The Government is in the process of streamlining and consolidating the direct as well as indirect taxation structure. It has released the Draft Direct Taxes Code (701 KB) - PDF file that opens in a new window and Discussion Paper (1.1 MB) - PDF file that opens in a new window on the same. It has also released the First Discussion Paper on Goods and Services Tax in India - External website that opens in a new window. Both these documents will undergo wide ranging consultations with the stakeholders and experts prior to finalisation. Citizens can provide feedback on the Draft Direct Taxes Code - External website that opens in a new window and the Goods and Services Tax - External website that opens in a new window.

Experts and commentators will continue with their assessments on what lies in store for the common man, the industry and everyone else. However, what finally emerges from the Finance Minister's briefcase on the day of the Budget, remains a closely guarded secret.