Analysis of Last 5 Years Union Budgets of India

An analysis on
Last 5 Year Union Budget of India
Project Report Submitted to
DEPARTMENT OF MANAGEMENT STUDIES MNIT
JAIPUR
Masters of Business Administration
Business Environment
Submitted by
Yogesh Meena
Submitted to
Dr. Shweta Sharma

Here is a brief overview of the budget of India for the last five years:
Introduction:
The Union Budget of India is an annual financial statement presented by the Finance
Minister to the Parliament of India. The budget provides an overview of the government's
finances, its revenue and expenditure, and its policies for the upcoming fiscal year. In this
analysis, we will examine the Union Budget of India for the past five years, from 2017-18 to
2021-22.
1. 2018-19:
Total Expenditure: Rs. 24.42 lakh crore
Revenue: Rs. 22.71 lakh crore
In the fiscal year 2018-19, the Indian government increased its allocation for agriculture,
rural development, and healthcare. The government increased the allocation for schemes
such as Ayushman Bharat and National Rural Employment Guarantee Act (NREGA). The
government also introduced a new scheme, Pradhan Mantri Kisan Samman Nidhi, for
providing income support to farmers.
The budget for 2018-19 focused on boosting economic growth, promoting infrastructure
development, and improving the standard of living for all citizens. The government aimed
to achieve a 7.5% GDP growth rate in 2018-19.
2. 2019-20:
In the fiscal year 2019-20, the Indian government increased its allocation for social
welfare schemes such as Pradhan Mantri Kisan Samman Nidhi, National Pension
Scheme, and Pradhan Mantri Jan Dhan Yojana. The government also increased the
allocation for rural development, education, and healthcare.
The budget for 2019-20 aimed to strengthen the economy, promote sustainable
development, and improve the quality of life for all citizens. The government also aimed
to achieve a $5 trillion economy by 2024-25.
3. 2020-21:
In the fiscal year 2020-21, the Indian government allocated funds for various schemes
such as PM-KISAN, Swachh Bharat Mission, and National Health Mission. However,

due to the COVID-19 pandemic, the government announced a series of relief measures
for the poor and marginalized sections of society. The government also increased its
allocation for the healthcare sector to fight against the pandemic.
The budget for 2020-21 focused on reviving the economy, promoting job creation, and
improving the healthcare system. The government also aimed to achieve a self-reliant
India and promote domestic manufacturing.
4. 2021-22:
In the fiscal year 2021-22, the Indian government focused on the healthcare sector, with
increased allocation for schemes such as PM Atmanirbhar Swasth Bharat Yojana and Jal
Jeevan Mission. The government also announced
5. 2022-23:
 Total Expenditure: The government is estimated to spend Rs 39,44,909 crore during
2022-23. This is an increase of 4.6% over the revised estimate of 2021-22. Out of the
total expenditure, revenue expenditure is estimated to be Rs 31,94,663 crore (0.9%
increase) and capital expenditure is estimated to be Rs 7,50,246 crore (24.5%
increase). The increase in capital expenditure is mainly due to a substantial increase in
loans and advances to state governments. Loans and advances by the central
government are estimated to be Rs 1,40,057 crore in 2022-23, an increase of 153%
over the revised estimates for 2021-22.
 Total Receipts: Government receipts (excluding borrowings) are estimated to be Rs
22,83,713 crore, an increase of 4.8% over the revised estimates of 2021-22. The gap
between these receipts and the expenditure will be plugged by borrowings, budgeted
to be Rs 16,61,196 crore, an increase of 4.4% over the revised estimate of 2021-22.
 Transfer to states: The central government will transfer Rs 16,11,781 crore to states
and union territories in 2022-23. This is a marginal increase of 0.5% over the revised
estimates of 2021-22. Transfer to states comprises: (i) devolution of Rs 8,16,649
crore out of the divisible pool of central taxes, and (ii) Rs 7,95,132 crore in the form of
grants and loans.
In 2021-22, as per the revised estimates, Rs 1,59,000 crore will be transferred to states
in the form of back-to-back loans in lieu of GST compensation.

 Deficits: Revenue deficit is targeted at 3.8% of GDP, and fiscal deficit is targeted
at 6.4% of GDP in 2022-23. The target for primary deficit (which is fiscal deficit
excluding interest payments) in 2021-22 is 2.8% of GDP.
 GDP growth estimate: The nominal GDP is estimated to grow at a rate of 11.1% in
2022-23.
Actuals
2020-21
Budgeted
2021-22
Revised
2021-22
Budgeted
2022-23
% change (RE
2021-22 to BE
2022-23)
Revenue
Expenditure 30,83,519 29,29,000 31,67,289 31,94,663 0.9%
Capital
Expenditure 4,26,317 5,54,236 6,02,711 7,50,246 24.5%
of which:
Capital Outlay 3,15,826 5,13,862 5,47,457 6,10,189 11.5%
Loans and
Advances 1,10,491 40,374 55,255 1,40,057 153.5%
Total
Expenditure 35,09,836 34,83,236 37,70,000 39,44,909 4.6%
Revenue Receipts 16,33,920 17,88,424 20,78,936 22,04,422 6.0%
Capital Receipts 57,625 1,88,000 99,975 79,291 -20.7%
of which:
Recoveries of
Loans 19,729 13,000 21,975 14,291 -35.0%
Other receipts
(including
disinvestments) 37,897 1,75,000 78,000 65,000
Total Receipts
(excluding
borrowings) 16,91,545 19,76,424 21,78,911 22,83,713 4.8%
Revenue Deficit 14,49,599 11,40,576 10,88,352 9,90,241 -9.0%
% of GDP 7.3% 5.1% 4.7% 3.8%
Fiscal Deficit 18,18,291 15,06,812 15,91,089 16,61,196 4.4%
% of GDP 9.2% 6.8% 6.9% 6.4%
Primary Deficit 11,38,422 6,97,111 7,77,298 7,20,545 -7.3%
% of GDP 5.8% 3.1% 3.3% 2.8%

Main Words of Each Budget
Word Cloud of Year 2023 Budget
The most recurring word in her speech is 'tax' (if you remove 'crore',
'per', 'lakh' and 'cent', which are the top four most-recurring words for
obvious reasons). 'Tax' occurs 43 times. The second most-recurring
word is 'development' which occurs 28 times and the third is
2018 2019 2020 2021 2022 2023
Tax, Digital
India
Tax,
Infrastructure,
Health, and
Education
sector
Tax,
Investment,
Financial
Sector
Tax,
Income
Infrastructure,
Health, Tax,
Duty,
Financial
sector
Tax,
Duty, Financial, UPI,
Telecom,
Ghatishakti

'infrastructure' (26 times), followed by 'government' (25) and 'income'
(24).
Indeed, personal income tax benefits garnered the most attention in the
budget. The next two words, 'development' and 'infrastructure', capture
how the government wants to boost growth and development by hugely
raising expenditure on building of infrastructure such as roads and
railways.
The words 'tax', 'development', 'infrastructure', 'government' and
'income' occur far more frequently than the words 'farmers' (13 times)
and 'agriculture' (11 times). These themes did get a lower priority in the
budget.The budget did not offer much to businesses. Not surprisingly,
the words 'business' and 'industry' occur less frequently than even
'farmers' and 'agriculture' as they occur only 10 times each.
'Manufacturing' too is low in ranking at 7 times.
Figure 1 and 2 Source- Ministry of Finanace
Actuals
2019-20
Budgeted
2020-21
Revised
2020-21
Budgeted
2021-22
Revised
2021-2022
Budgeted
2022-2023
Central Expenditure

Establishment
Expenditure of Centre
5,70,244 6,09,585 5,98,672 6,09,014
7,00,541 6,92,214
Central Sector Schemes/
Projects
7,57,091 8,31,825 12,63,690 10,51,703
11,95,078 11,81,085
Other Expenditure 7,27,025 8,87,574 8,26,536 10,11,887 10,21,631 11,32,813
Centrally Sponsored
Schemes
and other transfers
8,52,751 9,38,797
Centrally Sponsored
Schemes
3,09,553 3,39,895 3,87,900 3,81,305
4,15,351 4,42,781
Finance Commission
Grants
1,23,710 1,49,925 1,82,352 2,20,843
2,11,065 1,92,108
of which:
Rural Local Bodies 59,361 69,925 60,750 44,901 42,623 46,513
Urban Local Bodies 25,098 30,000 25,000 22,114 14,614 22,908
Grants-in-aid 10,938 20,000 22,262 35,376 35,376 36,486
Post Devolution
Revenue Deficit Grants
28,314 30,000 74,340 1,18,452
1,18,452 86,201
Other Grants 1,98,707 2,23,427 1,91,155 2,08,484 2,26,334 3,03,908
Total Expenditure 26,86,330 30,42,230 34,50,305 34,83,236 37,70,000 39,44,909
Break up of central government expenditure of last 3 years

Bar chart showing expenditure of last 3 years
Indirect taxes: The total indirect tax collections are estimated to be Rs 13,30,000 crore in 2022-23. The
government projects that GST will bring in Rs. 7,80,000 crore of this total. Out of the total tax collections
under GST, 85% is expected to come from central GST (Rs 6,60,000 crore), and 15% (Rs 1,20,000 crore)
from the GST compensation cess.
Corporation tax: In 2022–2023, it is anticipated that corporate tax receipts will rise by 13% to Rs 7,20,000
crore. According to the updated projections for 2021–22, corporation tax receipts will rise to Rs 6,35,000
crore from Rs 5,47,000 crore at the budget estimate stage.
Income tax: In 2022–2023, income tax receipts are projected to rise by 14% to Rs 7,00,000 crore. The
income tax revenue collection for 2021–2022 will be Rs 6,15,000, which is 9.6 percent more than Rs
5,61,000 in the budget estimate stage.
Non-tax receipts: In 2022–2023, income tax receipts are projected to reach Rs 7,00,000 crore, an increase
of 14%. According to the updated estimate for 2021–22, income tax receipts will total Rs 6,15,000, 9.6
percent more than the estimated amount of Rs 5,61,000 during the budget estimate stage.
Disinvestment target: The disinvestment goal is Rs 65,000 crore for 2022–2023. This is 17% less than the
updated forecast for 2021–2022. (Rs 78,000 crore).
Main tax proposals in the Finance Bill
Income tax: The rates of income tax for both individuals and corporations remain unchanged.
Surcharge on Long Term Capital Gains (LTCG): LTCG surcharges on listed stocks and equity mutual
funds are currently restricted at 15%. If your total income is between Rs 2 crore and Rs 5 crore, there is a
25% surcharge on other LTCG; if it is over Rs 5 crore, there is a 37% penalty. These are proposed to be
0
200000
400000
600000
800000
1000000
1200000
1400000
Last Three Year Budget Expenditure
2020-21 2021-22 2022-2023

capped at 15% in the budget.
Tax on virtual digital assets: The current cap on the LTCG fee on listed stocks and equity mutual funds is
15%. If the total income is between Rs 2 crore and Rs 5 crore and above Rs 5 crore, there is a 25% surcharge
on other LTCG and a 37% surcharge. The budget suggests capping these at 15%.
Updating return of income: Within two years of the assessment year, taxpayers will be able to submit an
amended return of income. If they file the tax return in the year following the assessment year, they will be
subject to a 25 percent penalty and a 50 percent penalty, respectively.
Co-operatives: The co-operatives' alternate minimum tax will drop from 18.5 percent to 15 percent. For
cooperatives with a total annual income of between one crore and ten crore rupees, the surcharge will be
decreased from 12 percent to 7 percent.
New companies and start-ups: If they begin production by March 31, 2023, new domestic enterprises
might choose to pay tax at a rate of 15% (without taking any deductions). If they incorporate by April 1,
2022, certain start-ups have the possibility of a tax break for three of the first 10 years. These dates have
both been pushed back one year.
Changes in customs duty: Over 500 goods now have different customs fees. Numerous exemptions from
customs are also being phased away.
Non-tax proposals in the Finance Bill
The Reserve Bank of India Act, 1934 is being changed to allow RBI to print its own digital money.
Policy Highlights
Legislative proposals: A new piece of legislation will take the place of the Special Economic Zones Act,
2005, allowing states to participate in the "Development of Enterprise and Service Hubs," which will
include both new and existing industrial enclaves. Agroforestry and private forestry will be promoted by
modifications to the law. To promote cross-border insolvency settlement, the Insolvency and Bankruptcy
Code will be amended.
Fiscal Management: Budgeted for in 2021–22 is Rs. 51,971 crore for paying off Air India's debts.
MSMEs: The duration of the Emergency Credit Line Guarantee Scheme (ECLGS) would be extended till
March 2023, and its guarantee cover will increase by Rs 50,000 crore to a total of Rs 5,000 crore. The
Lending Guarantee Trust for Micro and Small Enterprises will be updated to enable an extra two lakh crores
of rupees in credit.
Health and Nutrition: An open platform for the National Digital Health Ecosystem will be built under the
Ayushman Bharat Digital Mission. It will include digital databases of healthcare professionals and facilities,
individual health identifiers, a consent framework, and open access to healthcare facilities. To give people
access to high-quality mental health counselling and care services, a national telemental health programme
will be introduced.
River linking: An estimated Rs 44,605 crore would be spent on the Ken-Betwa Link Project's construction.
There are currently five additional river connecting projects in operation.
Labour and Employment: There will be a launch of the Digital Ecosystem for Skilling and Livelihood
(DESH) Stack e-portal. The portal will support residents in developing their talents, obtaining qualifications,
and locating relevant employment.
Infrastructure: The National Infrastructure Pipeline's projects for transportation and logistics infrastructure
will be in line with the PM GatiShakti framework, which was introduced last year. The North-Eastern

Council will implement the Prime Minister's Development Initiative for the North-East (PM-DevINE) to
finance development initiatives in the region. Additionally, one lakh crore rupees in the form of 50-year
interest-free loans is given to the states to encourage investment.
Roadways: In 2022–2023, the PM GatiShakti Master Plan for Expressways will be created. In 2022–2023,
the National Highways network will be extended by 25,000 km.
Railways: The one-station, one-product model will be used to support regional supply chains and local
enterprises. Over the following three years, 400 new Vande Bharat trains will be designed and produced.
Over the next three years, 100 freight terminals for multimodal logistics facilities will also be built.
Telecom: In order to allow the development of 5G mobile services between 2022 and 2023, spectrum
auctions will be held. A programme for design-led manufacturing will be introduced as part of the
Production Linked Incentive (PLI) Scheme to create an ecosystem for 5G.
Energy and Environment: For electric vehicles, a battery switching strategy will be adopted. There will be
four pilot projects for gasifying coal and converting coal into chemicals for the industry. In 2022–2023,
sovereign green bonds will be issued to raise money for green infrastructure.
Communications: According to the revised projection for 2021–22, allocation to the Ministry of
Communications will rise by Rs 50,890 crore (93 percent) in 2022–23. This is mostly due to the investment
of Rs 44,720 crore in BSNL.
Road Transport and Highways: According to the revised projection for 2021–22, allocation to the
Ministry of Road Transport and Highways will rise by Rs 67,959 crore (52 percent) in 2022–23. This is
primarily due to an increase in investment in the Indian National Highway Authority (Rs 1,34,015 crore in
2022-23 as compared to Rs 65,060 crore in 2021-22).
Transfer to states for COVID-19 vaccine support in 2021–2022 totaled Rs. 39,000 crore, which was more
than the Rs. 35,000 crore budget forecast. The allocation is Rs 5,000 crore for 2022–2023.
The drop in funding for the Ministries of Consumer Affairs, Food and Public Distribution, and Chemicals
and Fertilizers is primarily attributable to the elimination of the food and fertiliser subsidies, respectively.
Below, we go over the cost of subsidies.
Expenditure on Subsidies
In 2022-23, the total expenditure on subsidies is estimated to be Rs 3,55,639 crore, a decrease of 27.1%
from the revised estimate of 2021-22 (Table 5).
Food subsidy: In 2022–23, funding for food subsidies is projected to total Rs 2,06,831 crore, a drop of
27.8% from the revised projection for 2021–22. In order to lessen the effects of COVID-19, the Pradhan
Mantri Garib Kalyan Ann Yojana, which offers free foodgrains to the underprivileged, and the clearing of
Food Corporation of India's loans, a higher level of food subsidy was allocated for the years 2020–2021 and
2022–2023.
Fertiliser subsidy: In 2022–2023, it is anticipated that fertiliser subsidies will cost Rs 1,05,222 crore.
According to the updated forecast for 2021–22, this represents a drop of Rs 34,900 crore. The supplemental
requests in December 2021 led to a significant rise in the fertiliser subsidies for the years 2021–2022. This
was in response to a substantial rise in the price of raw materials required to make fertilisers on the global
market.
Petroleum subsidy: LPG and kerosene are included in petroleum subsidies. For 2021–2022 or 2022–2023,
there is no planned amount for kerosene subsidies. In 2022–2023, it is predicted that LPG subsidy spending

will drop by 10.8% to Rs 5,813 crore.
Other subsidies: Spending on other subsidies comprises, among other things, interest subsidies for various
government programmes, subsidies for the agricultural produce price support programme, and help with
procurement for state agencies. The cost of these other subsidies is expected to drop by 31% in 2022–23
compared to the updated estimate for 2021–22.

Analysis of Last 5 Years Union Budgets of India

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