Union Budget 2020 Preparation Process | Infographics

How is the Budget of India prepared?

The preparation of the Budget is as confidential as the Budget itself. It takes six months to prepare the Budget. Till it is presented in Parliament, the contents would be kept confidential. Various departments of the Union finance ministry coordinate the Budget works.

Data would be collected from various ministries, 28 states and Centre-ruled regions. Various departments would give the details of receipt-expenditure, new projects and the requirements for the coming year. This would include various demands such as funds for special projects and salaries. The Departments of Economic affairs and Revenue are responsible for this.

The Central Board of Direct Taxes and the Central Board of Indirect Taxes and Customs collect the data on tax returns till December 31 and submit them. They would also make an estimate of how much tax would be collected during the January, February and March months.

Talks would be held with farmers, industrialists, labour unions, bank and public enterprise chiefs. Their demands would be checked by the departments of economic affairs and revenue.

Union finance ministry compares the receipt-expenditure data. As per the Fiscal Responsibility and Budget Management Act, 2003, the fiscal deficit should not be more than three per cent of the country’s GDP. This should be reduced to 2.8 per cent in 2020 and 2.5 per cent in 2023.

Decisions would be taken on which all departments should be given concession. Checks would be made to ascertain whether the measures to be taken are in line with the ruling front's policies. The economic affairs secretary would compile the Budget.

The Department of Expenditure calculates the estimates of each ministry for the next year. The receipt-expenditure calculations enter the final stage. The Finance Minister makes a decision on the policy decisions that needs to be included in the Budget. The Finance Minister and other ministers hold talks with the Prime Minister, and gives a final shape to the Budget.

After the preparation of halwa in the presence of the Finance Minister, the printing work of Budget begins. The halwa ceremony would be held at the canteen of the North Block that houses the office of the Union Finance Ministry. The team, comprising senior officials, financial experts, and printing workers, then are not allowed to step out or even contact someone over the phone. Only the Finance Minister can visit the team.

Extensive security system is in place to ensure that the data is not leaked. A team of Intelligence Bureau (IB) officers led by the joint secretary is in charge of protection and surveillance. To prevent cyber theft, the computers of the stenographers would not be connected to the network servers of the National Informatics Centre. Mobile phone jammers would also be installed.

Ten days prior to the presentation, the printing of the Budget would begin. The printing would be held at the North Block press in utmost secrecy. In the earlier years, the printing was held at the Rashtrapati Bhavan. After data was leaked, it was shifted to a press on the Minto Road in 1950 and then to the basement of the North Block.

Documents to be printed: Key to budget, Union Finance Minister's Budget speech A and B sections, Budget in a glance, annual financial statement memorandum, receipt Budget, expenditure Budget, customs and central excise statement, the macro-economic frame work statement, medium-term fiscal policy statement, fiscal policy strategic statement, implementation statement, and output-outcome framework for schemes.

The Finance Minister's Budget speech, the most confidential document, would be printed last. It would be given for printing at midnight two days prior to the presentation. After the printing is completed, the Union cabinet gives approval for the Budget. The Finance Minister seeks the permission of the President to present the Budget and the Finance Bill in Parliament.

February 1: The Finance Minister would head to the Lok Sabha with the Budget. The Budget presentation is at 11 am. On behalf of the President, the Union Finance Minister would present the Budget. After it is presented in the Lok Sabha, it would be tabled in the Rajya Sabha.

The Finance Bill is a secret legislation introduced in the Lok Sabha immediately after the Budget is presented. It is a Money Bill that aims to give effect to the financial proposals of the Government in the ensuing financial year. With its tabling, the budget process comes to an end.

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