Union budget 2018 19

Union budget 2018-19
Objectives
Meaning of Budget
Types of budget
History of Indian Budget
Union Budget- part A and Part-B
Money Bill, Finance Bill and Finance Act
Highlights of Union Budget 2018-19
6/15/2018
Dr.G.Vincent, ASSOCIATE PROFESSOR ,CHRIST (DEEMED TO BE
UNIVERSITY) BANGALORE
1

UNION BUDGET 2017-18
 Dr.G.VINCENT,Ph.D
 Associate Professor
 Department of Commerce
 CHRIST(DEEMED TO BE UNIVERSITY)
 BANGALORE
 Vincent.g@christuniversity.in
 jeffvincent@rediffmail.com
6/15/2018
Dr.G.Vincent, ASSOCIATE PROFESSOR ,CHRIST (DEEMED TO
BE UNIVERSITY) BANGALORE
2

6/15/2018
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India’ Growth against the world

INDIA –Facts
 Human Development Index-130(2016) 135(2015)
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Union Budget
1. Balanced budget
2. Surplus budget
3. Deficit budget
Deficit budget increases liabilities and reduces its reserves
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Fiscal Responsibility and Budget
Management Act 2003(FRBMA)
 This act was passed
 To eliminate revenue deficit
 To bring down fiscal deficit to 3% of GDP
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Fiscal deficit
 when a government is unable to raise enough revenues to meet its expenditure
needs, it has to borrow.
 This it does either by issuing securities or bonds, or by borrowing from financial
institutions such as the World Bank.
 Nearly all governments borrow, and their debt is referred to as national debt or
sovereign debt
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Fiscal deficit………
 Fiscal deficit is the excess of expenditure over revenue, minus borrowing
 Budget has proposed to bring down the fiscal deficit for 2017-18 to 3.2% of the
GDP, and to 3% in the following year.
 Revenue Expenditure
 This is the money the government spends on salaries of its employees and
constitutional functionaries, interest payments on borrowings, and subsidies such
as selling cooking gas at below cost price.
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Capital Expenditure-
 This is the expenditure on building roads, power plants, health facilities — in short,
on anything that leads to the creation of an asset.
 More the capital expenditure more the development and income
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Why Demonitisation?

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History of Indian Budget
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 On 7th April, 1860, India’s first budget was presented by James Wilson
of East India Company to the British Crown
 Independent India’s first budget was presented by India’s first Finance
Minister R.K. Shanmukham Chetty, 5 pm on 26th November, 1947
 Halwa ceremomy-
 The budget presented by Manmohan Singh in 1992-93 is often hailed
as the most important budget of India ever created.
 He reduced import duty from 300% to 50%, which liberalized Indian
economy, and the modern IT industry owes much of its presence to that
decision.

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 Jawaharlal Lal Nehru, Indira Gandhi and Rajiv Gandhi presented the Union
Budget themselves during their prime ministerial tenures.

The 1965-66 Budget contained the first disclosure scheme for black
money.
 Morarji Desai, who first took charge of the finance ministry in 1958,
presented the Budget ten times-the most by any finance minister till date.

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 VP Singh was the first finance minister to stress on concessions for the
poor in his 1986 Budget.
Singh proposed bank loans with subsidies for rickshaw pullers, cobblers,
formation of small industries development bank and an accident insurance
scheme for municipal sweepers and railway porters.
 Yashwant Sinha, who was the finance minister from 1998 to 2002, changed
the timing of Budget presentation to 11 am. Before that, the timing was 5
pm

Basics of budget
 Budget is Estimate of inflows and outflows of the Government during a year.
 Budget is presented for the ensuing Financial year.
 Every budget consist of Actual figures for preceding years, Budget and
revised figures for the current year, Budget estimates for the following years
 Budget is to be presented in Lok Sabha on a day as the President directs.
 By convention, the Budget is presented in Parliament on the last working
day of February.
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6/15/2018
19 Timetable is drawn by the Business Advisory Committee (BAC) of
Parliament.
 In the schedule drawn up by the BAC, there is a fixed period of discussion
for each ministry.
 Budget Division in the Finance Ministry has the overall responsibility.
 It prepares the budget on basis of proposal received from various
departments and ministries and the availability of funds.
 However, final approval is from the Prime Minister.

Budget Document
 PART A
 Introduction of new Schemes,
 Priorities of the Government and focus areas are also indicated in this
part.

So Part A of the Speech is more concerned about the Macro aspect
of the Economy.
 This part is of more interest to the economist.
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 PART B
 deals with Taxation proposals.
 It has direct bearing over your family finances, which may squeeze or spread
to the proposals.
 PART B should also be read with Finance Act.
 Finance Act is a document containing Legal provisions.

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Process of budget apporval
1. The Finance Minister introduces the budget
2. general discussion
3. The demands for grants presented by each ministry are taken up by the House.
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 Appropriation Bill is introduced in the Lok Sabha
 Once this Bill is passed, it becomes the Appropriation Act and is certified as a
Money Bill.
 After passing of Appropriation Bill, the Finance Bill is introduced
 after the passing of this Bill, it enters the statute as the Finance Act
 Final budget gets approved
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Union budget 2018 19

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