According to Article 112 of the Indian Constitution, the Union Budget is a financial statement of the Union government’s estimated revenue and expenditure for that particular year. Every year, for the time period between April 1st and March 31st, the Union Budget is prepared. The Union Budget is basically classified into (a) Revenue Budget, and (b) capital Budget.
With the Union Budget for 2017-2018, the day of the Budget presentation was shifted to 1st February from the end of February. From that Budget, the Railway Budget was also integrated with the Union Budget.
As the whole country is waiting for the Union Budget of this year, OyeCreator brings the brief History of Indian Union Budget.
History of the Union Budget
This was not an Independent India, not the morning hour, and also not the month of February when the first Union Budget was presented. The first Union Budget was presented by the then Finance Minister of India, James Wilson on April 7, 1860, at 5 PM in the evening.
In the history of Independent India, the first Union Budget was presented on November 26, 1947, by the first Finance Minister of Independent India, Sir R.K. Shanmugham Chetty.
The first budget was carried in a Bag instead. That Budget was prepared on the backdrop of Partition riots. That Budget was only for seven and a half months following which the next budget was to be implanted from April 1st, 1948. The terms the “interim budget” come to exist in that year, that meant budget for the Short period.
The First Finance Minister of India, Sir Chetty resigned from his post and the responsibility passed on to John Mathai. He presented the subsequent Union Budgets of 1949-50 and 1950-51, who also announced the Planning Commission. The budget of 1949-50 was also the Budget that took into the account the princely states and India as United.
In 1957, for the first time in the history when the presented Budget by Krishnamachari-Kaldor was tried for the distinction between active income and passive income. Salaries or Business was added in active income, while interest or rent added to passive income.
Jawahar Lal Nehru became the first Prime Minister to present the Union Budget because he held the extra charges of finance minister as well.
Morarji Desai in his two terms as Finance minister presented a total 8 Annual Budget and 2 interim Budget. In his first stint, he presented 5 annual Budget and 1 interim budget, while in his second tenure, when he was both the Deputy Prime Minister and also finance Minster presented 3 annual Budget and 1 interim budget. From the interim Budget of 1962-63, the presentation of the Budget had moved to the last day of February but there is no changing of time that was 5 PM in the evening. One thing was very interesting in Morarji Desai’s time of Budget that he got to present two Budgets on his birthday, on February 29 in 1964 and 1968.
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Indira Gandhi who was the Prime Minister and also held the extra charge of the Finance Minister presented Indian Budget in 1970-71. This is the first time when any woman who presents the Indian Union Budget.
The budget which was presented in 1973-74 showed the fiscal deficit of Rs 550-Crore. This Budget is known as the “Black Budget” in India. Rajiv Gandhi presented the budget for 1987-88 and became the third Prime Minister to present a budget. Rajiv Gandhi introduced the Corporate Tax in 1987-88 budgets.
Manmohan Singh presented the interim Budget of 1992-93 became one of the historical budgets in Indian history. He announced to reduce import duty from over 300% to 50%, paving way for liberalization. In his budget speech, he said, “It is said that child is the father of the man, but some of our taxpayers have converted children into tax shelters for their fathers.”
Printing, Formalities, ceremonies and Utmost Secrecy related to Budget
The documents related to Union Budgets are treated with utmost secrecy because catastrophic effects will cause if any leak occurs. In the account of secrecy, even the Finance Minister is not authorized to keep the Blue Sheet.
All the important budget papers were printed inside Rashtrapati Bhavan until 1950. After that till 1980, this process held in a government-operated press in Minto Road. After 1980, the budget paper printing is done in a basement in the North Block.
There is a famous ritual which marks the start of the printing of the budget documents, known as the Halwa Ceremony. This ritual also marks the lockdown of the Finance Ministry, because all the officials who are directly in contact with the paper and data are locked down in the basement of the North Block where the Finance Ministry situated. No one allows to carried mobiles in Finance Ministry premise even the Finance Minister.
Lesser Known facts of the Indian Union Budget:
Till 2017, The Railway Budget of India has always been introduced as a separate Budget for the past 92 years.
Jawahar Lal Nehru became the first Prime Minister to present the Union Budget.
Indira Gandhi was the only woman Finance Minister to present the Union Minister who was also the Prime Minister of India while presenting the Budget.
There are only three Prime Minister who was also Finance Minister at the same time presented the Union Budget.
With the Union Budget for 2017-2018, the day of the Budget presentation was shifted to 1st February from the end of February.
The Budget of 1997-98 termed as “Dreamed Budget” by Indian Media because it was the roadmap for economic reforms in India.
The budget which was presented in 1973-74 showed the fiscal deficit of Rs 550-Crore. This Budget is known as the “Black Budget”.