BQ Explains: What Is A Budget?
The Union Budget will be announced on Feb. 1. Here’s what the document really means.
Just as any other establishment, institution or individual does, a government also prepares a budget to track its income and expenses. The document more or less lays down the roadmap for how the government plans to shape the coming financial year.
Before the beginning of a new fiscal in April, the government reveals its annual budget, which states where it hopes to earn its money from and how it plans to spend it. In 2023, the Union Budget is slated to be announced on Feb. 1.
In some countries, the budget is a mere accounting statement, while it has evolved in India into a document that lays down the government's economic priorities.
Higher spending on sectors like agriculture, education and public welfare signifies a focus on improving socio-economic conditions in the country. In contrast, a focus on infrastructure, housing and roads might mean that the government is trying to boost long-term economic growth potential.
A budget, which lowers taxes for consumers, may be considered populist in nature, but one which cuts taxes for corporations may be a way to boost investment in the economy.
On budget day, Finance Minister Nirmala Sitharaman will read out the document in the Lok Sabha, after which the proposals are debated in both the Lok Sabha and the Rajya Sabha. The budget can only be implemented after parliamentary approval.