Skip to main content

Cabinet Note on Budget Recast Soon

By
FinMin proposal involves merging rail & general budgets and advancing its presentation in Parliament to January from February end
The finance ministry will shortly move a cabinet note on a multidimensional recast of the budget that's set to mark a break with the past.The proposal involves merging the rail budget with the general budget and advancings its presentation in Parliament to January from February end.
If cabinet endorses the plan, a January budget will also see no distinction between plan and non-plan expenditure. And, if finance minister Arun Jaitley does succeed in getting the goods and services tax (GST) rolled out on April 1, revenues will take on a vastly different look, with the budget process being tweaked accordingly.
An internal government panel has backed the idea of doing away with a separate railway budget, a 92-year-old practice that dates back to the colonial era. The panel will suggest how this can be achieved.
“The proposal will be moved short ly,“ a senior government official told ET, underscoring its urgency. Traditionally, budget preparations begin in September with the issue of the budget circular. Officials in the budget division of North Block are keen on a decision at the earliest so that they can start preparations in keeping with the proposed changes and new date.
Merging the budgets will end a tradition that some say has lost relevance, besides helping the railways avoid politically negative scrutiny that's detrimental to efforts aimed at reviving the state-owned transporter. Advancing the announcement will allow the budget process to get completed well before the financial year begins, thus allowing ministries to get quickly off the mark with their plans rather than having to wait for parliamentary approval.
The next budget will in any case be different as the government has already decided to drop the plan and nonplan classification of expenditure, in line with recommendations by the Expenditure Management Commission and the C Rangarajan-led committee. The department of expenditure has already issued comprehensive guide lines for appraisal and approval of public-funded schemes and projects as the first step in line with these changes. The budget will now only have reve nue and capital differentiation.
If the budgets are unified, the finan ce minister will present a statement on railways. He will continue with the current government's tradition of not announcing new trains or routes. Railway finances could at best become a separate annexure.
A government panel is also considering whether India needs a new financial year as opposed to the current April-March period.
The report of the committee headed by Shankar Acharya looking into the possible change in financial year to January-December from AprilMarch is expected only by December.
The Economic Times New Delhi,12th September 2016

 

Comments

Post a Comment

Popular posts from this blog

RBI deputy governor cautions fintech platform lenders on privacy concerns during loan recovery

By
  India's digital lending infrastructure has made the loan sanctioning system online. Yet, loan recovery still needs a “feet on the street” approach, Swaminathan J, deputy governor of the Reserve Bank of India, said at a media event on Tuesday, September 2, according to news agency ANI.According to the ANI report, the deputy governor flagged that fintech operators in the digital lending segment are giving out loans to customers with poor credit profiles and later using aggressive recovery tactics.“While loan sanctioning and disbursement have become increasingly digital, effective collection and recovery still require a 'feet on the street' and empathetic approach. Many fintech platforms operate on a business model that involves extending small-value loans to customers often with poor credit profiles,” Swaminathan J said.   Fintech platforms' business models The central bank deputy governor highlighted that many fintech platforms' business models involve providing sm
Post a Comment
Read more

Credit card spending growth declines on RBI gaze, stress build-up

By
  Credit card spends have further slowed down to 16.6 per cent in the current financial year (FY25), following the Reserve Bank of India’s tightening of unsecured lending norms and rising delinquencies, and increased stress in the portfolio.Typically, during the festival season (September–December), credit card spends peak as several credit card-issuing banks offer discounts and cashbacks on e-commerce and other platforms. This is a reversal of trend in the past three financial years stretching to FY21 due to RBI’s restrictions.In the previous financial year (FY24), credit card spends rose by 27.8 per cent, but were low compared to FY23 which surged by 47.5 per cent. In FY22, the spending increased 54.1 per cent, according to data compiled by Macquarie Research.ICICI Bank recorded 4.4 per cent gross credit losses in its FY24 credit card portfolio as against 3.2 per cent year-on-year. SBI Cards’ credit losses in the segment stood at 7.4 per cent in FY24 and 6.2 per cent in FY23, the rep
Post a Comment
Read more

India can't rely on wealthy to drive growth: Ex-RBI Dy Guv Viral Acharya

By
  India can’t rely on wealthy individuals to drive growth and expect the overall economy to improve, Viral Acharya, former deputy governor of the Reserve Bank of India (RBI) said on Monday.Acharya, who is the C V Starr Professor of Economics in the Department of Finance at New York University’s Stern School of Business (NYU-Stern), said after the Covid-19 pandemic, rural consumption and investments have weakened.We can’t be pumping our growth through the rich and expect that the economy as a whole will do better,” he said while speaking at an event organised by Elara Capital here.f there has to be a trickle-down, it should have actually happened by now,” Acharya said, adding that when the rich keep getting wealthier and wealthier, they have a savings problem.   “The bank account keeps getting bigger, hence they look for financial assets to invest in. India is closed, so our money can't go outside India that easily. So, it has to chase the limited financial assets in the country and
Post a Comment
Read more