What is 'Union budget'?
• The Union Budget, referred to as the annual Financial Statement in Article 112 of the Constitution of India, is the annual budget of the Republic of India, presented before the beginning of each financial year by the Finance Minister of India in Parliament.
• It is the statement of government’s finances for the financial year, where the government makes estimates of revenue and expenses for the upcoming fiscal year that runs from April 1 to March 31.
• The word 'budget' has its origin in the French word Bougette, which means leather briefcase.
• From 2017-18, the government merged the Railway Budget with the Union Budget.
Who makes the Budget ?
• The budget is made through a consultative process involving ministry of finance, NITI Aayog and other ministries.
• Finance ministry issues guidelines to spending, based on which ministries present their demands.
• The Budget division of the Department of Economic Affairs in the finance ministry is the nodal body responsible for producing the Budget.
How is the budget made?
• Budget division issues a circular to all union ministries, states, UTs, autonomous bodies, departments and the defence forces for preparing the estimates for the next in year.
• After ministries & departments send in their demands, extensive consultations are held between Union ministries and the Department of Expenditure of the finance ministry.
• At the same time, the Department of Economic Affairs and Department of Revenue meet stakeholders such as farmers, businessmen, FIIs, economists and civil society groups to take their views.
• Once the pre-Budget meetings are over, a final call on the tax proposals is taken by the finance minister. The proposals are discussed with the PM before the Budget is frozen.
• The finance ministry collects information about receipts and expenditure from various departments to prepare the revised estimates for the budget.
• The government also holds pre-budget consultations with stakeholders such as state representatives, bankers, agriculturists, economists and trade unions to understand their demands, which includes tax incentives and fiscal support.
Budget printing & presentation
• The finance minister and other officials participate in 'halwa ceremony', which marks the process of printing documents for the Budget.
• The Finance Minister presents the budget in the Lok Sabha outlining key estimates and proposals.
• The budget is tabled in the Parliament after the minister's speech.
