Discover India - General Budget

Budget is a systematic plan for the expenditure of a usually fixed resource during a given period. The word Budget was derived from the French word, bougette, which in turn is a diminutive of bouge, meaning a leather bag.

The Union Budget of India, referred to as the Annual Financial Statement in Article 112 of the Constitution of India, is the annual budget of the Republic of India. Barring a few exceptions -- like elections - Finance Minister presents the annual Union Budget in the Parliament on the last working day of February. The budget has to be passed by the Lok Sabha before it can come into effect on April 1, the start of India's financial year.

 

What is the Budget all about?


R.K.Shanmugam Chetty

The General Budget, also known as the Union Budget, which is a yearly affair, is a comprehensive display of the Government's finances. It is the most significant economic and financial event in India. The Finance Minister of the Central Government puts down a report that contains Government of India's revenue and expenditure for one fiscal year. The fiscal year runs from April 01 to March 31.

The General Budget is preceded by an Economic Survey which outlines the broad direction of the budget and the economic performance of the country. The Budget is the most extensive account of the Government`s finances, in which revenues from all sources and expenses of all activities undertaken are aggregated. It comprises the revenue budget and the capital budget. The revenue budget consists of revenue receipts of the government (revenues from tax and other sources) and the expenditure met from these revenues. Capital Budget consists of capital receipts and payments. It also contains estimates for the next fiscal year called budgeted estimates.

Railway Budget

The Railway Budget is presented to the Parliament by the Union Railway Minister, two days prior to the General Budget. The Railway Budget deals with planned infrastructure expenditure on the railways as well as with the operating revenue and expenditure for the upcoming fiscal years. However, there has been a proposal in recent times to club the Railway Budget along with the General Budget.

Chronology

The first Union budget of free India was presented by Mr. R. K. Shanmukham Chetty on November 26, 1947. Prime Minister Smt. Indira Priyadarshini Gandhi who also held the post of Finance Minister in 1970-71 was the first and only woman to present the Union Budget to date.

Until the year 2000, the Union Budget was announced at 5 pm on the last working day of the month of February. This practice was inherited from the colonial era, when the British Parliament would pass the budget in the noon followed by India in the evening of the day. It was Mr. Yashwant Sinha, the then Finance Minister of India in the government led by Mr. Atal Bihari Vajpayee, who changed the ritual by announcing the 2001 Union Budget at 11 am.

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