How Union Budget Is Prepared In India

Most People Do Not Know About The Way India’s Budget Is Prepared.

Read further If you are also one of those.

Union Budget 2023 is around the corner. Almost everyone is expecting something from it. Everyone is waiting for February 1st, 2023 for this reason.  

The Finance Minister of India, Shrimati. Nirmala Sitaraman, present the budget once again. She will do so for the third time in a row.

India will come to standstill during her presentation. She will be the nucleus from 31st January 2023 to 06th February 2023.

But the entire India is already talking about it. Most people are talking about the following two things only:

• Relief people are expected to get this time. 
• Everything is likely to be excluded from it.

This is the only thing most of us know about.

What Else Do We Need To Learn About the Union Budget?

There are some more things we must know about it. The list includes but is not limited to the following only:

Types of Budget

All of us must know about it. Surplus budget, fiscal budget, and deficit budget are the types of budgets presented in India. Listed below are the types of budgets presented in India:

• Surplus Budget.
• Fiscal Budget.
• Deficit Budget.

Budgeting Methods Used

Four different types of methods mentioned below are used in order to prepare an effective budget:

• Incremental.
• Activity Based.
• Value Proposition.
• Zero Based.

It is then categorised into multiple categories.

All Key Documents Are Prepared

Our central government prepares a couple of documents. These documents matter in the preparation of our country’s budget. Take a good look at the list of those documents below:

• Annual Financial Statement is the first document prepared. 
• Demands For Grants File is the second key document prepared. 
• Receipts Budget is another valuable document prepared. 
• Two Volumes of Expenditure Budget are also documented. 
• Finance Bill is the next most important document on this list.
• Another equally important document prepared is the Memorandum Explaining The Provisions In The Finance Bill.
• Budget At A Glance.
• Highlights of The Budget. 
• Status of Implementation of Announcements Made In Finance Minister’s Budget Speech.
• Even Fiscal Responsibility And Budget Management Act Related Documents are also prepared. Macro-economic Framework Statement, Medium Term Fiscal Policy Statement and Fiscal Policy Strategy Statement are these documents.

Which Steps Are Followed For Budget Preparation?

A systematic approach is very important while preparing the national budget. Our government follows the principle for this reason.

• First, a circular is issued to all concerned ministries. 
• Second, top government officials, economic experts, and the department of expenditure extensively discuss every request or suggestion available in proposals received. 
• Third, the allocation of the budget is performed after a discussion on everything. 
• India’s Finance Minister then organises a couple of pre-budget meetings with all stakeholders. These meetings are organised for the purpose of knowing their proposals, demands, and issues. 
• Halwa Ceremony then marks the inception of the printing of all budget documents prepared.

This is how the budget of the world’s largest democracy gets prepared. Our Finance Minister then presents it in front of everyone through a speech in the parliament.

• India’s budget is approved once the president of India signs it. 

Wrapping Up! 

India’s Central Government has prepared this year’s budget with such a systematic approach. We must have improved your knowledge about the hard work that goes into the entire process.