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| Photo from prepp by collegdunia |
A. Introduction:
The budget is an annual financial statement of the government of India which details the reciepts & expenditures by the government of India in a very detailed manner. The union budget for the financial year 24 was announced on 1 Februrary 2023 with a vision for amritkaal
This year budget was unique for many aspects one among them being that this was the last full time budget of this term of the Narendra Modi government. The second unique issue was of rising the Capital expenditure by a whopping 33%. Usually in the budgets the expenditure part is always dealt with a lot of focus to ensure it as a confidence building measure with the masses at a time.
B. Basic definitions: In economics, there are generally 2 kinds of expenditure, one is revenue expenditure is the part of the budget which does not lead to creation of assets in short or long term. It may create assets indirectly but it does not create assets directly. Best examples can be of pensions, salaries to employees, welfare schemes,defence budget etc.
Though these expenses can create social welfare but they do not create direct capital value in the economy.The other kind is of capital expenditure which should either result in creation of assets or in reduction of liabilities for the government. It has a direct affect on the total fiscal deficit as well.
C. Prominent verticals analysis:
Pensions expenditure: Pensions are generally given to the people who have retired from the service. In India, currently the national pension system (NPS) is in force in India. In this section we will talk about the pensions for the central government employees. As per the Budgeted estimates of the FY 24, the expenditure on pensions is projected to be upto 2,34,359 crore which is a rise by 13% from the last year budgeted estimates which was pegged to be 2,07,132 crore. The rise in the pensions expenditure by the government is due to the fact that the revised estimates of the FY23 defeated the Budgeted estimates by approximately 43,000 crore, hence the rise in the pensions have occured. The number of employees enrolled in the EPFO system will also consider a good chunk of the central government employees who have recently enrolled into the system, hence its a highly plausible that with increased formalisation of economy, the pension bill of the government will also likely surge. The government of India has to also keep a close button on the expenditure on pensions as it can cause the government of India to reduce its capital, 2 solutions can be of increasing revenue through direct sources & implementing NPS at a breakneck pace.
PM KISAN Scheme: The PM Kisan Samman Nidhi which gives farmers Rs. 6000 per year as basic minimum support. Its a central government funded scheme. Its operational in most of the states in India.It became operational from 1 December 2018, under the scheme, e-KYC is compulsory and every farmer has to register himself with it. The PM Kisan Samman Nidhi has been allocated funds worth 60000 crore which is down by 8000 crore from the budgeted estimates of the Fiscal year 2023, the possible reason can be that the Revised estimates of the FY 23 was at exact 60000 crore, which means that upto 10 cr farmers would be given the benefits of the same. However, with general elections scheduled for 2024, we may see more states registering more farmers for the PM-Kisan scheme meaning the revised estimates can very well defeat the budgeted estimates for this fiscal year.
Development of North east: The development of north east is of top priority for the government of India , the 8 states of north-east India(Sikkim,Arunachal Pradesh, Assam, Meghalaya,Mizoram, Manipur,Nagaland, Tripura) which are startegically important for India's national security along with being blessed with a lot of natural resources which can be the engine for India's economic growth in the future. The funds allocated for the development of north east has been approximately about 5900 cr this budget, this is a percentage rise of almost about 110.42% which is probably the highest budget hike probably in the entire budget. The government of India would be seeing to complete important projects like PM-DevINE scheme out of which mostly is for capital expenditure which is almost of 70% of the capital outlay this year,the allocation of tribal sub plan has been enhaced to 1690 cr. However, the entire development of north east should also happen in a holistic manner and it would be good if modern infrastructure like Vande Bharat trains are also provided.Some, routes for Vande Bharat express can be from Dibrugarh-Siliguri, Agartala-Tinsukia to name a few. The infrastructure development in north east will strengthen India's economy as a whole.
Education: Education is the backbone for the economic development in any country. The education budget of India is pegged to be at 1,12,889 crore which is approximately a percentage rise of 8.257% as compared to the previous year education budget which was about 1,04,278 crore in the FY23. Some important projects enhanced to the education sector this year has been of issues like the promotion of research in India, enhancement of services of national digital library, building of 157 nursing colleges along with the existent medical colleges, along with building of IIT's, IIM's in different cities. Cities where IIT can be started are as follows: Warangal, Davangere, Surathkal, Kozhikode, Coimbatore,Kangra, Udhampur,Darjeeling,Shillong, Lucknow, Pune, Vishakapatnam, Imphal to name a few. Similarly IIM's can be started in: Mysore, Trivandrum, Darjeeling, Agartala, Jaipur,Karimnagar, Nagpur,Shimla, Mehsana, Barmer,Anantnag. The IMU's can also be started in multiple cities along the coast line where the Indian coast guard has been posted so that a proper integration between maritime security & development of blue economy takes place, some of the places can be: Vizag, Paradwip, Howrah,Shillong,Thottukudi, Vizhingam, Jamnagar, Mumbai, Karwar. Some other important schemes can be launched is of a shikshak samman nidhi to remove the underpayment of the teachers.
Transport: The transport-logistics sector has been the most critical sector for the Indian economy from the past few years, with many big ticket projects coming up recently like the Samruddhi Mahamarg, Delhi-Mumbai expressway to name a few. The transport sector has seen its budgeted expenditure rise by a whopping 46.94% to the present figure of 5 lakh 17 thousand crore which is almost 4.5 times the budget allocated to the home ministry.Though this expenditure can be considered as a capital expenditure but its an expenditure which will bring a lot of qualitative change in the lives of people in India, majority of whom travel using roadways.
Conclusion:
The blog focused only on a few specifics because these are the issues which form the basics of the economic developmement in a sustainable manner.
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