The history of India’s budget is an extremely fascinating reflection of the country’s economic, social, and political evolution. Since its independence in 1947, the Indian Union Budget has played a pivotal role in steering the nation’s developmental trajectory. It is not just a financial statement but a blueprint that encapsulates the government’s vision for the economy. India’s first budget as an independent nation was presented on November 26, 1947, by R.K. Shanmukham Chetty, the then Finance Minister. It was a simple budget that primarily outlined the challenges of post-Partition India, such as food shortages, refugee rehabilitation, and industrial reconstruction. The budget introduced measures to stabilise the economy and initiate development, laying the groundwork for planning.
India’s First Union Budget (1947-48): Defense Takes Nearly Half of Total Spend
In a defining moment of India’s economic history, the nation’s first Union Budget for the financial year 1947-48 allocated almost half of its total expenditure to the Department of Defence Services. Presented by Finance Minister R.K. Shanmukham Chetty on November 26, 1947, the budget reflected the immediate priorities of a newly independent nation grappling with partition and security challenges.
The budget was not only a fiscal exercise but also a blueprint for the stabilisation of a nascent economy. While defense received the lion’s share, the budget also laid the groundwork for addressing other critical areas, including administration and rehabilitation, albeit with limited resources.
1948-49: FM Shanmukham Chetty Introduced the “Interim Budget”
In a pivotal moment for India’s financial governance, the then Finance Minister R.K. Shanmukham Chetty introduced the term “interim budget” in the fiscal year 1948-49, establishing a practice that has since become an institutional hallmark in election years.
The interim budget, presented as a temporary fiscal measure, allowed the government to authorise necessary expenditures while deferring the presentation of a full budget until a new legislative assembly could be elected and convened. Over the decades, the concept has evolved into a standard procedure during election years, where governments present an interim budget to maintain essential services and expenditure, leaving major policy decisions to the incoming administration.
1949-50: Budget Abolished Capital Gains Tax
The Union Budget for 1949-50 marked a significant shift in India’s taxation policy by abolishing the capital gains tax. Presented during the early years of India’s economic restructuring, the decision was aimed at simplifying the tax regime and encouraging capital formation in a developing economy.
At the time, the tax on capital gains was relatively new and faced challenges in implementation, particularly in monitoring and preventing evasion. Over time, the capital gains tax was reintroduced with improved systems to monitor transactions and curb evasion, becoming a critical component of India’s tax framework.
1950-51: Budget Announces Formation of Planning Commission
The Union Budget for 1950-51 heralded a transformative moment in India’s economic governance with the announcement of the Planning Commission, a new body tasked with steering the nation’s development agenda. For over six decades, the Commission played a crucial role in shaping Indian policies, driving social and economic progress, and fostering equitable development. This was later on replaced by the NITI Aayog in 2015.
1951-52: Budget Doubles Surcharge on Alcoholic Beverages
The Union Budget for 1951-52 introduced a significant fiscal measure by doubling the surcharge on a widely consumed category of agro-based products, including ale, beer, spirits, and other liquors. Finance Minister C.D. Deshmukh proposed the increased levy as part of broader efforts to fund developmental initiatives while moderating the consumption of alcohol.
1952-53: Budget Announces Assistance from Ford Foundation
The Union Budget for 1952-53 marked a significant international partnership with the announcement of assistance from the Ford Foundation, a prominent U.S.-based philanthropic organisation. The partnership was aimed at supporting India’s developmental initiatives during its early years of nation-building.
Presented by Finance Minister G.B. Pant, the budget highlighted the collaboration with the Ford Foundation, which pledged financial and technical aid for various sectors, including education, health, and rural development.
1953-54: Budget Raises Income Tax Exemption Limit, Providing Major Relief to Taxpayers
The Union Budget for 1953-54 delivered significant relief to taxpayers with a notable increase in the income tax exemption limit. The exemption limit was raised from Rs 3,600 per annum to Rs 4,200 per annum, offering substantial relief to a large segment of the population.
This move, introduced by Finance Minister C.D. Deshmukh, aimed at easing the tax burden on the middle class and aligning the tax structure with the economic realities of the time.
1954-55: Budget Announces Plans for ICICI, India’s Specialised Industrial Lending Institution
The Union Budget for 1954-55 laid the foundation for a major development in India’s industrial financing with the announcement of plans to establish the Industrial Credit and Investment Corporation of India (ICICI). ICICI’s establishment was a critical milestone in the evolution of India’s financial sector.
1955-56: Budget Introduced Tax Exempt Slabs for Married and Unmarried Individuals
The Union Budget for 1955-56 brought in a significant reform by introducing different tax exemption slabs for married and unmarried individuals. The move was part of the government’s broader efforts to create a more equitable and efficient taxation system, catering to diverse demographic needs.
1956-57: Budget Reintroduced Capital Gains Tax
In the 1956-57 Union Budget, the government reintroduced capital gains tax, reversing the earlier abolition of this levy in 1949-50. This tax aimed to capture the profits made from the sale of assets such as property and securities, and it became a significant tool in India’s evolving fiscal policy.
1957-58: Budget Introduced Wealth Tax
The 1957-58 Union Budget introduced the Wealth Tax, a landmark move that remained in effect for six decades. The tax was designed to target the affluent section of society, with the objective of redistributing wealth and reducing economic disparities. By taxing the net wealth of individuals above a certain threshold, the government aimed to generate revenue for development while promoting social equity. The wealth tax remained a cornerstone of India’s tax system until it was eventually abolished in 2016.
1958-59 Budget: Prime Minister Nehru Introduces Gift Tax in His Only Budget as Finance Minister
In the 1958-59 Union Budget, Prime Minister Jawaharlal Nehru, in his capacity as Finance Minister for that year, introduced the Gift Tax. This new tax aimed to address the transfer of wealth through gifts and estates. The gift tax, part of Nehru’s broader fiscal reforms, was designed to curb the concentration of wealth and generate additional revenue for national development.
1959-60: Budget Introduces Structural Change: Clubbing of Plan and Non-Plan Expenditures
The Union Budget for 1959-60 introduced a significant structural change in India’s financial framework by clubbing Plan and Non-Plan expenditures under a single consolidated budget estimate. The main aim was to streamline the budgetary process and provide a clearer picture of the government’s financial priorities and simplify the allocation of resources between development and non-development sectors.
1960-61: Budget Reveals Controversial PL 480 Import Scheme for Foodgrains
The Union Budget for 1960-61 drew attention for its estimates related to the controversial PL 480 scheme, a U.S.-backed program that facilitated the import of foodgrains to India. The budget included detailed projections for the scheme, which aimed to address the country’s severe food shortages in the face of challenges like poor harvests and rising population.
1961-62: Budget Announced Oil Refinery with Special LoC from Soviet Union
The Union Budget for 1961-62 marked a significant development in India’s industrial expansion with the announcement of a new oil refinery to be established using a special Line of Credit (LoC) extended by the Soviet Union. The oil refinery was part of India’s broader efforts to reduce dependence on imported petroleum and boost domestic production. The LoC from the Soviet Union was instrumental in financing this critical infrastructure project, underscoring the strengthening of bilateral economic relations between the two countries.
1962-63: Budget Proposed Highest Income Tax Rate of 72.5 per cent
The Union Budget for 1962-63 proposed a steep income tax rate of 72.5 per cent, excluding surcharges, making it the highest tax rate at the time. This move was part of the government’s fiscal strategy to address rising deficits and finance economic development programs.
The proposed tax rate, which applied to the highest income brackets, was a reflection of the government’s focus on wealth redistribution and funding large-scale public projects. The decision was aimed at increasing state revenues to support India’s industrialisation and infrastructure needs. However, such high tax rates also sparked debates on economic policy and the impact on private enterprise.
1963-64: Super profit tax was introduced
In the 1963-64 Union Budget, the government introduced the Super Profit Tax, aimed at taxing companies with excessively high profits. This move targeted large corporations and sought to redistribute wealth to support national development and social welfare initiatives.
1964-65: Expenditure tax was introduced in the budget
The following year, in the 1964-65 Budget, the government introduced the Expenditure Tax, levied on individuals with annual spending exceeding Rs 36,000. The tax aimed to capture unaccounted wealth by targeting high-spending individuals, marking a significant step in India’s efforts to curb tax evasion and wealth concentration.
1965-66: Black money abolition attempt was made through VDS
In 1965-66, India launched its first formal attempt to tackle black money with the introduction of the Voluntary Disclosure Scheme. This initiative allowed individuals to disclose their unaccounted wealth without facing penalties, thereby encouraging transparency and fostering trust in the formal economy.
1966-67: Removal of Expenditure tax
However, by the 1966-67 Budget, the Expenditure Tax was removed as the government shifted focus towards more effective measures to track unaccounted wealth. The removal of this tax signaled the government’s ongoing adjustments to the evolving fiscal landscape, balancing the need for revenue generation with the desire to create an equitable economic environment.
1967-68: Morarji Desai Presents a Unique Budget as Both PM and FM
The Union Budget for 1967-68 was a historic occasion, as it was introduced by Prime Minister Morarji Desai, who also held the position of Finance Minister. This dual role was unprecedented in Indian financial history and reflected Desai’s central role in shaping the country’s economic policies.
1968-69: Abolition of Spouse Allowance as a Tax Saving Tool
The Union Budget for 1968-69 saw the abolition of the spouse allowance, a tax-saving tool that had been widely used by individuals to reduce their tax liabilities. This move was aimed at curbing loopholes and promoting a more streamlined and equitable tax structure. This change was a significant step toward simplifying the taxation system and ensured a fairer distribution of tax benefits and closing avenues for evasion.
1969-70: Rise in Imported Car Prices Following Tax Increases
The 1969-70 Union Budget saw the imposition of higher taxes on imported goods, particularly luxury items. Among the most notable impacts was the sharp rise in the price of imported cars. The government’s decision to increase taxes on these high-end vehicles was framed as an attempt to curb unnecessary imports and encourage domestic manufacturing
1970-71: India’s First Woman Finance Minister Presents the Budget
The Union Budget for 1970-71 was unique for another historic reason – it was the first budget to be presented by a woman. Indira Gandhi, India’s Prime Minister at the time, took on the role of Finance Minister and presented the budget, making history as the first woman in the country to do so. This budget was a significant milestone not only for India’s political landscape but also for women’s representation in governance.
1971-72: Budget Imposes Tax on Foreign Travel Tickets
The Union Budget for 1971-72 introduced a tax on foreign travel tickets purchased in Indian rupees, a move that had a direct impact on travelers. The decision was part of the government’s broader fiscal strategy to control foreign exchange outflow and manage the nation’s foreign reserves.
This tax, levied on tickets for overseas travel, was designed to discourage unnecessary foreign travel and curb the increasing demand for foreign currency. While aimed at stabilising the balance of payments, the measure affected both business and leisure travelers, marking a significant shift in India’s fiscal policies during the early 1970s.
1972-73: Budget Faces Criticism Over Tax on Crossword Rewards
The Union Budget for 1972-73 included a controversial proposal to tax rewards earned from solving crossword puzzles, a move that sparked criticism among literature and puzzle enthusiasts. The proposal aimed to treat monetary prizes from crossword competitions as taxable income. While the proposal was debated widely, it reflected the government’s growing focus on expanding the tax net and ensuring that all forms of income, no matter how unconventional, were subject to taxation.
1973-74: Budget Proposes Tax on Wealthy Villagers and Non-Agricultural Income
The Union Budget for 1973-74 introduced a significant proposal aimed at taxing wealthy villagers, marking a notable shift in India’s taxation policy. The proposal suggested considering non-agricultural income from rural areas as a determining factor for tax slabs, thus expanding the tax base to include affluent individuals in villages who were previously not subject to income tax.
1974-75 Budget: Income Tax Reforms and Lowering of Maximum Tax Rate
It introduced crucial reforms in India’s income tax structure. One of the most notable changes was the reduction of the maximum marginal rate of income tax, which was aimed at incentivising higher income earners and fostering a more dynamic economic environment.
By lowering the tax rate, the government sought to promote investment and stimulate economic activity, while also easing the burden on individuals.
1975-76: Budget Introduced Incentive Bonus Scheme to Protect Savings
The Union Budget for 1975-76 contained a significant measure aimed at preventing individuals from dipping into their savings during a period of economic uncertainty. The government introduced the Incentive Bonus Scheme, designed to encourage people to save by offering bonuses on their deposits in financial institutions. This initiative was a response to inflationary pressures and sought to maintain financial stability by providing an attractive alternative to withdrawing savings for consumption.
1976-77 Budget: Launch of the 20-Point Program
The Union Budget for 1976-77 laid the foundation for one of the most defining programs of the Congress government in the years that followed – the 20-Point Program. Announced by Prime Minister Indira Gandhi, the program was a comprehensive policy initiative that aimed at addressing poverty, unemployment, and social welfare through targeted reforms.
1977-78 Budget: A Historic First for Non-Congress Government
The Union Budget for 1977-78 was unique in Indian history as it marked the first budget presented by a non-Congress government. After the Janata Party’s victory in the 1977 general elections, this budget represented a shift in political and economic priorities. Finance Minister Charan Singh’s proposals focused on reducing government control over the economy and promoting market-driven policies, a sharp departure from the policies of the Congress-led administration.
1978-79: Demonetisation by Janata Party Government
The 1978-79 Union Budget is most notable for the demonetisation initiative undertaken by the Janata Party government. Led by Prime Minister Morarji Desai, the government demonetised Rs 1,000, Rs 5,000, and Rs 10,000 currency notes in an effort to curb black money, corruption, and hoarding of wealth. While the move was controversial and faced significant criticism, it was seen as a bold step towards formalising the economy and addressing illicit financial practices.
1979-80 Budget: Relief for Non-Cereal Producing Farmers
In the 1979-80 budget, the government made a landmark move that benefited a specific group of farmers, those who did not produce cereals. The budget announced the abolition of excise duties on unmanufactured tobacco, directly impacting farmers involved in tobacco cultivation.
1980-81 Budget: Curbing Non-Essential and Aspirational Spending
The 1980-81 budget introduced a critical step towards curbing non-essential and aspirational spending in the economy. One of the key measures was the imposition of a tax on food and drinks, marking a shift in the government’s approach to regulating consumption patterns.
1981-82 Budget: Impact of Import Tax on Newsprint
The 1981-82 budget introduced a widely impactful measure, a 15 per cent import tax on newsprint. This decision had far-reaching consequences for the media industry, affecting the cost structure of newspapers and periodicals. The policy was designed to encourage the use of domestically produced paper, while simultaneously addressing the balance of payments concerns that arose from heavy imports.
1982-83 Budget
Presented by Finance Minister R. Venkataraman, the 1982-83 budget provided much-needed relief to the salaried class, particularly those nearing retirement. A significant provision introduced in this budget was the tax exemption on unused earned leave. This policy was aimed at offering financial support to individuals in their retirement years.
1983-84 Budget
In the 1983-84 budget, Finance Minister V.P. Singh proposed an exemption from excise duties for pressure cookers. This was aimed at boosting domestic production and making affordable, essential household items more accessible to the public.
1984-85 Budget
Finance Minister Pranab Mukherjee, in his 1984-85 budget, made a significant historical reference by quoting the ancient Indian strategist Kautilya, reflecting the deep-rooted wisdom of India’s economic thought.
1985-86 Budget
The 1985-86 budget, under Finance Minister V.P. Singh, introduced a forward-looking initiative that laid the foundation for modern-day insolvency reforms. The establishment of the Board for Industrial and Financial Reconstruction (BIFR) aimed to address the growing issue of industrial sickness and provide a framework for the rehabilitation of financially distressed companies.
1986-87 Budget: Introduction of MODVAT
The 1986-87 budget saw the introduction of the Modified Value Added Tax (MODVAT), a significant precursor to the Goods and Services Tax (GST) implemented decades later. This system was a key step towards simplifying indirect taxation in India and paved the way for the eventual introduction of the GST, which merged various indirect taxes into one unified structure.
1987-88 Budget: Introduction of Minimum Alternate Tax (MAT)
The 1987-88 budget introduced the Minimum Alternate Tax (MAT), aimed at ensuring that companies that enjoy exemptions under tax laws still contribute a minimum tax to the government.
1988-89 Budget: Launch of Kisan Vikas Patra (KVP)
The 1988-89 budget introduced a new tax-saving scheme, the Kisan Vikas Patra (KVP), which became extremely popular among Indian investors. This scheme offered a unique investment opportunity where the invested amount would double in 5.5 years, providing both safety and attractive returns.
1989-90 Budget: Introduction of Equity Linked Savings Scheme (ELSS)
The 1989-90 budget brought forward a new avenue for tax-saving investments in the form of the Equity Linked Savings Scheme (ELSS). This scheme allowed taxpayers to invest in mutual funds that primarily invested in equities, offering both tax deductions under Section 80C and the potential for higher returns through equity markets.
1990-91: Investment Allowance Abolished
The Union Budget for 1990-91 marked a significant policy shift with the abolition of the popular tax incentive known as the investment allowance. This move aimed to streamline the tax structure and curb revenue loss while encouraging more efficient allocation of capital by businesses. The change reflected the government’s focus on simplifying fiscal policies to foster long-term economic stability.
1991-92: Manmohan Singh Opens Indian Economy
The 1991-92 Union Budget, presented by Finance Minister Dr. Manmohan Singh, was a landmark in India’s economic history as it aimed at sweeping liberalisation reforms. In his historic speech, Dr. Singh quoted French novelist Victor Hugo, saying, “No power on earth can stop an idea whose time has come.” The quote reinforced the urgency of reforms that dismantled the license raj, eased foreign investments, and opened the Indian economy to global markets.
1992-93: Poetic Commentary on Taxation
In the 1992-93 Budget, Dr. Manmohan Singh once again infused literary flair into his address by quoting William Wordsworth: “The child is the father of the man.” Using the poetic reference, he humorously critiqued a loophole in the tax system, stating, “Some of our taxpayers have converted children into tax shelters for their fathers.” The remark addressed the misuse of provisions meant for dependents, emphasising the government’s intent to close such tax evasion mechanisms.
1993-94: Establishment of the National Stock Exchange
The 1993-94 Budget announced the establishment of a major institution to modernise India’s financial markets: the National Stock Exchange (NSE). This landmark decision aimed to bring transparency, efficiency, and professionalism to India’s stock market operations. The NSE, now a premier exchange in India, played a pivotal role in transforming the country’s capital markets, fostering investor confidence, and driving economic modernisation.
1994-95: Introduction of Service Tax
The Union Budget for 1994-95, presented by Finance Minister Manmohan Singh, introduced a new tax on services, a sector that accounted for nearly 40 per cent of India’s GDP at the time. This marked the birth of the service tax in India. Initially levied on a limited number of services, the tax was designed to align with the growing contribution of the service sector to the economy. Over time, it became a major revenue source before being subsumed under the Goods and Services Tax (GST) in 2017.
1995-96: Financial Sector Reforms
The Union Budget for 1995-96, presented by then Finance Minister Dr. Manmohan Singh, unveiled a major financial sector reform plan, including the establishment of an independent regulatory authority for the insurance industry. This move laid the groundwork for the formation of the Insurance Regulatory and Development Authority of India (IRDAI) in 1999. The reform aimed to open the insurance sector to private players, foster competition, and ensure consumer protection through robust regulation.
1996-97: Introduction of FIPB to Monitor Overseas Investments
In the 1996-97 Union Budget, Finance Minister P. Chidambaram unveiled a pivotal mechanism to oversee overseas investments in India, establishing the Foreign Investment Promotion Board (FIPB).
1997-98: Voluntary Disclosure of Income Scheme (VDIS) to Combat Black Money
The 1997-98 Budget introduced a bold measure to address the issue of unaccounted wealth. The Voluntary Disclosure of Income Scheme (VDIS) provided an opportunity for individuals and entities to declare undisclosed income by paying a specified tax.
1998-99: Special Schemes for NRIs
In 1998-99, Finance Minister Yashwant Sinha launched two landmark initiatives to attract investments from Non-Resident Indians (NRIs). The UTI India Millennium Deposit Scheme, offered by the Unit Trust of India, and SBI’s Resurgent India Bonds were designed to channel NRI funds into India’s infrastructure and development projects.
2000-01: Introduction of “Kargil Tax”
The Union Budget for 2000-01 introduced a significant measure to support national defense, imposing an additional 5 per cent surcharge on individuals with an annual income exceeding Rs 1.5 lakh. Dubbed the “Kargil Tax,” the surcharge was aimed at financing the costs incurred during the Kargil conflict and bolstering India’s defense preparedness.
2001-02: Transfer Pricing Regulations Take Effect
In the 2001-02 budget, Finance Minister Yashwant Sinha unveiled transfer pricing regulations, marking a milestone in India’s tax administration. These regulations were designed to curb tax evasion by ensuring that transactions between related entities, particularly multinational companies, were conducted at arm’s length prices.
2002-03: A Budget of Maximum Rollbacks
The 2002-03 Union Budget, presented by Yashwant Sinha, became notable for its unprecedented number of rollbacks. Various proposals faced resistance from stakeholders, leading to amendments and reversals during the budget session.
2003-04: FM Jaswant Singh Aims to Simplify India’s Tax System
In the 2003-04 Union Budget, Finance Minister Jaswant Singh highlighted the importance of making India’s tax system simple. He said he wanted to create a system so easy to understand that even Einstein would find it clear.
2004-05: Chidambaram’s “New Deal for Rural India”
Finance Minister P. Chidambaram’s first budget under the United Progressive Alliance (UPA-I) government in 2004-05 drew inspiration from history, naming it a “New Deal for Rural India,” reminiscent of U.S. President Franklin D. Roosevelt’s famous economic program during the Great Depression.
2005-06: UPA-1 Introduces Landmark Welfare Schemes and Tax Proposals
The Union Budget for 2005-06, presented during the second year of the UPA-1 government, laid the foundation for significant socio-economic reforms by announcing two major welfare schemes and two notable tax measures.
Among the key highlights was the launch of the National Rural Employment Guarantee Scheme (NREGS). On the tax front, the government introduced the Fringe Benefit Tax (FBT) and the Banking Cash Transaction Tax (BCTT).
2006-07: A Roadmap for Systematic Tax Overhaul
In the 2006-07 Union Budget, the government outlined an ambitious roadmap for a systematic tax overhaul, emphasising modernisation and simplification of India’s indirect tax structure. The plan set the stage for the introduction of the Goods and Services Tax (GST), which aimed to unify multiple levies into a single comprehensive tax system.
2007-08: Budget Targets Tax Evasion via Non-Financial Assets
The Union Budget for 2007-08 took a significant step toward tightening tax compliance by proposing the tracking of investments in non-financial and non-realty assets, such as sculptures and paintings.
2008-09: Historic Loan Waiver for Farmers Announced
The following year, the 2008-09 budget introduced one of the largest agricultural relief measures in India’s history – a loan waiver scheme for farmers, costing the exchequer Rs 60,000 crore.
2009-10: UIDAI Announced in UPA 2’s First Budget
The Union Budget for 2009-10, the first under the second United Progressive Alliance (UPA) government, unveiled a landmark initiative with the establishment of the Unique Identification Authority of India (UIDAI). The UIDAI was tasked with creating a biometric-based unique identity system to enhance the delivery of government services and curb leakages in welfare schemes.
2010-11: Rupee Symbol Places India Among Elite Global Group
The Union Budget for 2010-11 marked a historic moment as it announced a plan to formalise a symbol for the Indian Rupee (Rs), placing India among an elite group of nations – the United States, United Kingdom, Japan, and the European Union – that have unique symbols for their currencies.
2011-12: Pranab Mukherjee Brings Divine References to Budget Speech
The Union Budget for 2011-12, presented by then Finance Minister Pranab Mukherjee, stood out for its unique invocation of two Hindu deities – Lord Indra and Goddess Lakshmi – during his speech.
2012-13: Pranab Mukherjee’s Controversial Farewell Budget
The 2012-13 budget, Mukherjee’s last as Finance Minister, was marked by significant controversy and disruption. Delayed due to the U.S. Assembly elections, the budget introduced the contentious retrospective tax, which sought to tax certain corporate transactions retroactively.
2013-14: Chidambaram Introduces ‘Super Rich Tax’
In the Union Budget for 2013-14, Finance Minister P. Chidambaram, presenting his last full budget, introduced a new tax system targeting the super-rich. Individuals with an annual income exceeding Rs 1 crore were subjected to a surcharge, dubbed the “super-rich tax.”
2014-15: FM Arun Jaitley’s Record-Breaking Budget
Finance Minister Arun Jaitley’s maiden Union Budget for 2014-15 stood out for two unique features. First, it marked the longest budget speech in India’s history at the time, reflecting a comprehensive roadmap for economic revival. Second, the budget introduced 12 schemes, each allocated Rs 100 crore.
2015-16: A Rare Saturday Presentation
Breaking tradition, the Union Budget for 2015-16 was presented on a Saturday, a departure from the usual practice of Friday presentations. In an unprecedented move, Indian stock markets remained open to align with the announcement.
2016-17: Project Indradhanush to Revitalise Public Sector Banks
The 2016-17 budget introduced “Project Indradhanush,” a comprehensive program aimed at revitalising India’s ailing public sector banks (PSBs). With a massive capital infusion plan, the initiative sought to address the twin challenges of mounting non-performing assets (NPAs) and inadequate capitalisation.
2017-18: A Budget of Firsts
The Union Budget for 2017-18 introduced three groundbreaking changes in India’s financial governance. For the first time in history, the Railway Budget was merged with the Union Budget, signaling a move towards unified fiscal planning. Additionally, the traditional classification of expenditure into “Plan” and “Non-Plan” categories was abolished, simplifying budget presentations and focusing on capital and revenue spending. Another first was the presentation of the budget on February 1, advancing it from the traditional end-of-February date to enable early implementation of fiscal policies.
2018-19: Strengthening Accountability and Curbing Cash Transactions
The 2018-19 Union Budget announced measures to enhance transparency and accountability, particularly in the functioning of NGOs and trusts. It mandated monitoring unaudited expenses by these entities to ensure compliance with financial regulations. Furthermore, the budget prohibited payments exceeding Rs 10,000 in cash.
2019-20 (Interim Budget): Launch of PM-KISAN Scheme
The interim budget for 2019-20 was marked by the launch of the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) scheme. Under the scheme, eligible farmers receive Rs 6,000 annually in three equal installments, directly credited to their bank accounts.
2019-20 Full Budget: Nirmala Sitharaman Became Second Woman to Present Union Budget
The Union Budget for 2019-20 witnessed a historic moment as Nirmala Sitharaman became the second woman in India’s history to present the nation’s budget, following in the footsteps of Indira Gandhi, who had done so in 1970-71. Her presentation of the iconic “bahi-khata” (ledger) instead of the traditional briefcase also symbolised a shift towards Indian traditions, adding a unique touch to the event.
2020-21 Budget: Enhanced Bank Deposit Insurance Announced
The following year, the 2020-21 budget addressed a critical concern of millions of depositors by enhancing the insurance cover on bank deposits from Rs 1 lakh to Rs 5 lakh.
2021-22: Voluntary Vehicle Scrapping Policy
The Voluntary Vehicle Scrapping Policy aimed to phase out old and unfit vehicles, promoting environmental sustainability and road safety. The policy incentivised owners to retire vehicles that failed fitness tests after 15 years for personal vehicles and 20 years for commercial ones. By reducing air pollution and fuel inefficiency, it not only aligned with India’s climate goals but also bolstered the automobile industry by creating demand for new, fuel-efficient vehicles. The initiative emphasised cleaner air, better roadworthiness, and responsible consumption.
2022-23: Advancements in Payment Systems and Digital Currency
Recognising the rapid evolution of financial ecosystems, the 2022-23 budget introduced measures to enhance payment systems and leverage blockchain technology. Key highlights included:
● Central Bank Digital Currency (CBDC): The Reserve Bank of India proposed launching a digital rupee, enhancing the efficiency of the monetary system. Built on blockchain and other advanced technologies, the CBDC aimed to reduce transaction costs, promote transparency, and support digital transactions.
● e-RUPI: This cashless and contactless voucher-based payment system was introduced to streamline benefit transfers. Enabled by the Unified Payments Interface (UPI), e-RUPI vouchers ensured targeted delivery of benefits without the need for intermediaries, enhancing efficiency in government welfare programs.
2023-24: Agri Accelerator Fund Announced for Rural Startups
The Union Budget 2023-24, presented by Finance Minister Nirmala Sitharaman, introduced a groundbreaking initiative to support startups in rural India. A dedicated Agri Accelerator Fund was announced.
2024-25 Interim Budget: A Nelsonesque Allocation Stands Out
The interim budget for 2024-25 captured attention with a striking figure that bore Nelson Esque characteristics. Finance Minister Sitharaman earmarked Rs 1,11,11,11 crore as capital expenditure.
2024-25 Final Budget: Angel Tax Abolished for All Investors
In a major relief for the Indian startup ecosystem, the final budget for 2024-25 abolished the so-called “angel tax” for all categories of investors.
The history of India’s budget shows how the country has grown from a newly independent nation to a rising economic power. After gaining independence in 1947, India faced many challenges, like poverty, lack of infrastructure, and a weak economy. The early budgets focused on addressing these immediate issues, setting the stage for long-term development.
Over the years, each budget has reflected the country’s changing priorities. For example, in the early years, the focus was on rebuilding the economy, developing industries, and creating jobs. As the country grew, the budget started to address newer challenges, like fiscal deficits (the gap between government spending and income), income inequality, and regional disparities.
Despite progress, these challenges continue to be a part of India’s economic landscape. However, the budget remains a key tool in guiding the country’s development. It balances the need for financial discipline (fiscal prudence) with the goal of ensuring that all sections of society benefit from growth (social equity). This balance is crucial for achieving inclusive and sustainable growth, ensuring that India’s progress benefits everyone, not just a few.
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