Preparation of interim budget in final stage, Sitharaman’s team is giving final touch

New Delhi (Uttam Hindu News): Preparations for Interim Budget 2024 have reached the final stage. Finance Minister Nirmala Sitharaman and her team of top officials of the ministry are giving final touches to it. North Block has been put in lock-down to ensure complete confidentiality after the ‘Halwa Ceremony’. According to sources, discussions are going on day and night regarding the budget between the team of PMO officials headed by Principal Secretary to the Prime Minister PK Mishra and the team of Finance Ministry officials. These discussions ensure that the thrust of the schemes designed by the Prime Minister with a deep understanding of the ground realities is adequately represented in the fine-print of the Budget.

Finance secretary TV Somanathan, a Tamil Nadu cadre officer who served as additional secretary in the Prime Minister’s Office (PMO) before joining the finance ministry, is a key link between the two teams. Top members of Finance Minister Nirmala Sitharaman’s team leading the budget-making exercise in the ministry include Revenue Secretary Sanjay Malhotra, Department of Economic Affairs Secretary Ajay Seth, Department of Investment and Public Assets Secretary Tuhin Kanta Pandey, Department of Financial Services Secretary Vivek Joshi and Chief Economic Advisor V Ananth Nageswaran. During the printing of the Union Budget in North Block, most officials have to remain in the office without any contact with the outside world in the days leading up to the Budget. They will be allowed to go home only after the budget is presented on February 1.

The last week is the culmination of the 6-month budget preparation exercise in which all ministries like agriculture, rural development, industry, power, highways and ports prepare their estimates and present them to the finance ministry. The Finance Minister, with the assistance of her team, examines the proposals and keeps them in close consultation with the PMO, keeping in mind the allocations to be made with the overall fiscal deficit and government policies aimed at promoting growth and inclusive growth. Sitharaman will present the interim budget for the financial year 2024-25 on February 1, making her the second finance minister of the country after Morarji Desai to present the budget in Parliament for the sixth consecutive time.

The full budget for 2023-24 will be presented after the formation of the new government after the 2024 general elections. The interim budget is presented by the government which is in the last year of its tenure before the Lok Sabha elections. The interim budget is needed because withdrawing money from the Consolidated Fund of India to run the government requires fresh approval from the Parliament. The current 2023-24 budget is valid only till March 31 this year. Since Lok Sabha elections are being held in April-May this year, funds will be required to run the country until the new government takes over. The interim budget is a practical arrangement that enables the government to fill this gap.

The interim budget is similar to the Union Budget in which the ruling government presents in Parliament its expenditure, revenue, fiscal deficit and fiscal performance and estimates for the upcoming financial year. Although major tax proposals have not been made, the ruling government may make some tax changes as it did when it raised the income tax deduction limit to give some relief to salaried professionals ahead of the 2019 Lok Sabha elections. The government does not make any major policy announcements during the interim budget which may put a financial burden on the next elected government to present the full Union Budget. According to the Election Commission’s code of conduct, the government cannot include any major scheme in the interim budget as it may influence voters. The government also does not present the Economic Survey along with the Interim Budget which is conducted a day before the presentation of the main Budget.