The concept of budgeting has been around since ancient times. In the past, governments used the power of the purse to control resources, create incentives or promote agendas. As civilizations evolved and complex trade systems were established, budgeting strategies became more sophisticated. The modern budgeting process first emerged in the 17th century when the British government instituted a centralized approach to taxation and public finance. This system allowed the government to better control expenses and revenues associated with public services.
Throughout the last 300 years, the government budgeting process has undergone numerous changes. For example, the budget format used by many governments today emerged in the early 19th century after the industrial revolution which made it easier to take account of the expenses and revenues of both private and public entities. Moreover, the budgeting process became increasingly complex after World War II when governments looked to create better economic stability and ensure their nation’s economic growth.
Today, budgeting is as much about managing economic growth as it is about controlling deficits. Governments use the budget to regulate the economy by setting taxes, controlling spending and redirecting resources towards various projects or industries. Budgeting also helps governments assign resources more efficiently, monitoring where money is being used and ensuring that essential services are being allocated equitably.
However, it is important to note that budget policies and processes are not static. In fact, the budget is constantly evolving and adapting to changing economic and political conditions. For example, many countries have had to adjust their budgeting process in the wake of the COVID-19 pandemic, where governments are utilizing fiscal stimulus measures to support their economies.
In order to keep up with changing times, governments must continue to review and update their budgeting processes, ensuring that they remain effective and efficient. Such changes will include introducing new budgeting instruments, investing in technology to improve budgeting accuracy, and establishing fiscal policies that are able to address the emerging economic challenges. The budget should also be regularly reviewed to identify any gaps or weaknesses and ensure that the budgeting process is effective and relevant for the current economic climate.
The budget of the Government of India for 2022-23 was Rs 39.45 lakh crore. Rs 3.96 lakh crore for defense sector in the budget, Rs 2.70 lakh crore for agriculture and allied activities, Rs 7.49 lakh crore for rural and urban development, Rs 3.38 lakh crore for health, Rs 2.84 lakh crore for education, Rs 1.15 lakh crore were allocated Rs. Rs 6.51 lakh crore was allocated for environment, for transport and Rs 6.54 lakh crore for communication services..
The government budget for 2023-24 is expected to be “Rs 42.40 lakh crore”. The budget is expected to allocate Rs 5.05 lakh crore for the defense sector, Rs 3.02 lakh crore for agriculture and allied activities, Rs 8.27 lakh crore for rural and urban development, Rs 3.68 lakh crore for health, Rs 3.12 lakh crore for education, Rs 1.22 lakh crore for environment, Rs 7.26 lakh crore for transportation, and Rs 7.09 lakh crore for communication services.
The Indian government’s budget for 2023-24 is estimated to be a whopping Rs 42.40 lakh crore. This budget is expected to allocate outsized amounts to key sectors such as defense, agriculture, rural and urban development, health, and education, amongst others. Historically, the Indian government has experimented and implemented a range of measures to bring economic growth and development, but these have come at a cost in the form of fiscal deficits or cuts to other important sectors such as environment and transportation. With the ongoing COVID-19 pandemic and the heightened conflict in both Russia and Ukraine, the government has complex financial and security decisions to make in the upcoming budget about how to provide for and ensure a bright and prosperous future for their citizens.
*****
(Author can be reached at email address casharma.sharad2000@gmail.com or on Mobile No. 9990365673)
Disclaimer: “Neither this article nor the information contained herein shall in any way be construed as forming a contract or shall constitute professional advice required before acting upon any matter. CA Sharad Kumar Sharma has taken all due care in the preparation of this article for accuracy in its contents at the time of publication. However, no liability shall be accepted by him in the event of any direct, indirect or consequential damages arising out of or in any way connected with the use of this article or its contents. “
Author Bio
