Union Minister of Finance and Corporate Affairs Nirmala Sitharaman speaks in the Lok Sabha during the Monsoon Session of Parliament in New Delhi on July 30, 2024.
| Photo Credit: ANI

Finance Minister Nirmala Sitharaman on July 30 termed misleading claims by Opposition leaders that if any State is not named in the Budget speech, then it does not get any budgetary allocation.

Replying to a Budget discussion in the Lok Sabha, Ms. Sitharaman asserted that no State was being denied money. She recalled that in the past Budgets by the UPA government also did not mention names of all states in their Budget speech.

Ms. Sitharaman asked, “I have been picking up on Budget speeches since 2004-2005, 2005-2006, 2006-2007, 2007-2008 and so on. The Budget of 2004-2005 did not take the name of 17 States. I would like to ask the members of the UPA government at that time — did money not go to those 17 States? Did they stop it?”

She was responding to comments by several Opposition members that the Budget has provided funds only to Bihar and Andhra Pradesh and nothing to other States.

Ms. Sitharaman said India is the fastest-growing economy globally and has overcome the after-effects of the pandemic due to a heavy capex push.

She also said the government is complying with the fiscal deficit trajectory. It will bring down the deficit to below 4.5% by 2025-26 from the targeted 4.9% for the current fiscal. The deficit was 5.6% in 2023-24.

The Budget has provided substantial financial support of ₹17,000 crore to the Union Territory of Jammu & Kashmir this year. It includes ₹12,000 crore towards financing the cost of J&K police. “That’s the burden we want to take on our shoulders,” Ms. Sitharaman said.

The Lok Sabha approved the ₹48.21-lakh crore Budget for FY2024-25 of the Union Government. The lower House also approved the budget of the Union Territory of Jammu and Kashmir with a voice vote.

Union Finance Minister Nirmala Sitharaman addresses a post-Budget press conference in New Delhi on July 23, 2024.
| Photo Credit: ANI

The Ministry of Minority Affairs has seen a mere 2.7% increase, from funds allocated in the previous year’s Budget Estimate (BE), for the financial year 2024-25 in the Union Budget presented on Tuesday. This allocation is around 22% of the Revised Estimate (RE), but monetary allocation in schemes like coaching and education loans have been slashed.

This year’s BE show that the Ministry is getting 0.07% of the government’s total outlay, which amounts to a mere 0.01% more than last year’s share of the total outlay.

Live updates from the Union Budget 2024-25 on July 23, 2024

The BE for the coaching and allied schemes for minorities has been slashed from ₹30 crore in 2023-24 to ₹10 crore in 2024-25. The RE for this scheme in 2023-24 was ₹14 crore. The BE for the interest subsidy on educational loans for overseas education for minorities has also been reduced from ₹21 crore to ₹15.30 crore. The RE for this scheme was ₹7 crore.

The BE for education scheme for Madrasas and Minorities has gone down from ₹10 cr in 2023-24 to ₹2 cr in 2024-25. The RE for this scheme in the previous financial year was ₹5 crore.

The BE for Pre-Matric Scholarship for Minorities, which was ₹433 crore in 2023-24 and was revised to ₹400 crore, stays at ₹326.16 for the ongoing financial year. However, the BE for the Post-Matric Scholarship for Minorities has seen an increase from ₹1,065 crore to ₹1,145.38 crore. The RE for this scheme last year was ₹1,000 crore.

The BE for development of minorities in Northeast areas this year is ₹318.70 crore as against ₹309.70 crore in the last financial year which was later revised to ₹261.44 crore.

The BE for grants-in-aid to State governments has been increased to ₹527.12 crore from ₹247.21 crore in 2023-34. The RE for the same was ₹237.54 crore. The BE for the grants-in-aid to Union Territory governments was increased to ₹20.06 crore from ₹0.33 crore last year, which was revised to ₹0.17 crore.

However, the BE for Pradhan Mantri Jan Vikas Karyakaram has seen a massive increase from ₹600 crore in 2023-24 to ₹910 crore.

Previously, the government has already scrapped minority schemes including Maulana Azad National Fellowship (MANF), schemes that were supporting students from the minority community to appear in competitive exams like UPSC, SSC etc.

External Affairs Minister S. Jaishankar.
| Photo Credit: ANI

India-funded projects in the neighbourhood received the bulk of the allocation for the Ministry of External Affairs (MEA) under the Union Budget presented by Finance Minister Nirmala Sitharaman on Tuesday.

Nepal secured an allocation of ₹700 crore, which is a jump of ₹150 crore from previous year’s allocation of ₹550 crore. Sri Lanka, which has a number of India-funded projects, has received ₹245 crore, an improvement of ₹95 crore over last year’s funding of ₹150 crore. Seychelles, which had an allocation of ₹10 crore, has also received a boost in funding with the infusion of ₹30 crore.

Dip in funding

Bhutan, the largest recipient of the annual allocation under the MEA, has seen a dip in funding by ₹332.02 crore. Total funding for Bhutan this year stands at ₹2,068.56 crore. Bhutan and India are close economic partners and Foreign Secretary Vikram Misri visited Thimphu last week, when the two sides cleared 61 projects amounting to ₹4,958 crore. The slight reduction in the annual allocation therefore does not indicate a reduction in funding for projects in Bhutan.

Dips in funding were seen for Myanmar, Mauritius, Bangladesh, and Mongolia.

Conflict-torn Myanmar, which had an allocation of ₹400 crore last year, received ₹250 crore this year. Mauritius, with an allocation of ₹370 crore, has received ₹90.79 crore less than the previous year. The allocation for Mongolia, which earlier received ₹7 crore, has been scaled down to ₹5 crore.

Allocation for Bangladesh has dropped by ₹80 crore to ₹120 crore. Both Afghanistan and the Maldives, with ₹200 crore and ₹400 crore, respectively, have secured the same allocation as last year.

The Budget also allocated an additional ₹5 crore for MEA’s ‘Aid for Cultural and Heritage Projects’, bringing the total allocation to ₹15 crore.

A PSLV rocket carrying the X-Ray Polarimetry Satellite (XPoSat) lifts off from the Sriharikota spaceport, January 1, 2024.
| Photo Credit: ANI/ISRO

With no major space missions slated for 2024, the Department of Space has recieved only a nominal hike of 4% in its allocation in the Interim Union Budget for 2024-25, from ₹12,545 crore to ₹13,043 crore. The Indian space programme will spend much of the year on pre-launch testing milestones for the lunar exploration (Chandrayaan) and human spaceflight (Gaganyaan) missions, and some other projects.

In 2023, the Indian Space Research Organisation (ISRO) launched and successfully executed its long-awaited Chandrayaan-3 mission, to soft-land a robotic instrument on the moon. ISRO also launched the Aditya-L1 mission to study the sun and the XPoSat — short for ‘X-ray Polarimetry Satellite’ — mission to track and study neutron stars and black holes from space. India also signed the Artemis Accords to participate in the United States’ multilateral programme to return humans to the moon by 2025.

Also read: Budget 2024 live updates

The major launches slated for 2024 include an uncrewed Gaganyaan test flight, the third developmental flight of the Small Satellite Launch Vehicle, and the NASA-ISRO Synthetic Aperture Radar mission. ISRO scientists and engineers have also been working on propellants, satellite propulsion systems, new launch vehicles, and technology transfer to the industry.

Spaceflight startups may benefit

In her Budget speech, Finance Minister Nirmala Sitharaman announced a corpus of ₹1 lakh crore, with five-decade interest-free loans, to boost private sector investment in research and development. While the details are not clear, India’s nascent private spaceflight sector and its 200 or so startups are expected to benefit from this infusion. The revenue expenditure of IN-SPACe, the nodal agency setup by the Union Cabinet in 2020 to oversee the activities of this sector, also increased 24%.

Similarly, revenue for space technologies — which includes work on Gaganyaan and the development of systems for new launch vehicles and spaceflight missions — increased 27%.

Also read: Where does the money come from and where is it allocated?

The 8% increase in the allocation for space technologies is, however, out of keeping with the work planned on the next two missions in the Chandrayaan programme: Chandrayaan 4 and the Lunar Polar Exploration mission, and a partially reusable launch vehicle, among others. Then again, the Department of Space underutilised its allocation for space technologies in 2023-2024 by more than ₹1,500 crore.

Finally, expenditure for INSAT satellite systems was halved from ₹531 crore in 2023-2024 to ₹276 crore in 2024-2025, with capital expenditure dropping by 60%. ISRO is expected to launch the INSAT-3DS meteorological satellite later this month.

People watch Union Finance Minister Nirmala Sitharaman presenting the Interim Budget 2024 in Parliament, at a television showroom in Kolkata, Thursday, Feb. 1, 2024.
| Photo Credit: PTI

Finance Minister Nirmala Sitharaman presented the Interim Budget in the Lok Sabha today. In her Budget speech she spoke of the profound transformation undergone by the Indian economy over the past 10 years and asserted that citizens were looking forward to the future with optimism. Highlighting themes of Sabka Saath, Sabka Vikaas, and Atmanirbhar Bharat, Ms. Sitharaman sketched out the achievements of the current administration towards inclusive development, before laying out the measures that will tide India over for the first four fiscal months of 2024. (Since this is an election year, the Union Budget will only be presented in June-July, post the elections. )

Ms. Sitharaman noted that the government will continue on path of fiscal consolidation to reduce fiscal deficit to 4.5% in 2025-26. She announced that the capital expenditure outlay is being expanded to Rs. 11.1 lakh crore in the coming year. She did not propose any changes relating to taxation and said that the government proposes to maintain the same tax rates for direct and indirect taxes, including import duties.

Also read: Budget 2024 live updates

Here is a look at where the money for the Budget comes from and where it shall be allocated.

Where from

Borrowings and other liabilities form the largest chunk of where money flows in from for this Budget, at 28%. At the second spot is income tax at 19%, followed by inflow from GST and other taxes at 18%. Corporation tax also makes up a significant chunk at 17%. Non-tax revenue, union excise duties, customs and non-debt capital receipts is where the government gets the rest of its budget money from.

Where to

The government spends equal amounts in interest payments and paying out the States’ share of taxes and duties— 20%. Next on the list is central sector schemes, which snag 16% of the pie. Finance Commission and other transfers, the defence sector and centrally-sponsored schemes get about 8% each of the government’s money. Other miscellaneous expenditures take up 9%, while subsidies get 6%. Pensions round out the spend, claiming 4% of the government’s money.

Finance Minister Nirmala Sitharaman on Wednesday, February 1, presented the last full budget of the Narendra Modi government before the 2024 general elections. The Minister announced a range of new initiatives, revised income tax slabs and customs duty, and sops for agriculture and energy transition.

The Union Budget 2023-24 document also listed the new allocations for core welfare schemes that drive socio-economic development. Here’s a roundup of how the budgetary allocations for some of the key schemes have changed-

MGNREGS: The government slashed the budget for its flagship rural employment scheme, the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) by nearly 32% compared to the ₹89,400 revised estimate for the scheme in the current year.

Also read | Explained | The funding and demand for MGNREGA

The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) was passed in 2005 and aimed at enhancing the livelihood security of households in rural areas. Under it, the MGNREGS is a demand-driven scheme that guarantees 100 days of unskilled work per year for every rural household that wants it, covering all districts in the country except those with a 100% urban population.

Food Subsidies: The Centre has allocated a little above ₹2 lakh crore for the food subsidy under the National Food Security Act (NFSA)- this includes funds for the Food Corporation of India, funds for decentralised procurement of grains by State agencies, and other logistical costs. Starting from January 1, 2023, the Centre had decided to provide 5 kg of free foodgrains per month to the 81.35 crore beneficiaries of the NFSA for one year starting from January 2023, rather than charging them a subsidised amount of ₹3 a kg of rice, ₹2 a kg of wheat and ₹1 a kg of coarse cereal as is usually done.

It was announced in December that the government was terminating the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY), which had provided an additional 5 kg of free grains every month to NFSA beneficiaries after being launched as an emergency measure in response to the COVID-19 pandemic in April 2020 and received multiple extensions since. In a normal year, without COVID disruptions, the Centre’s food subsidy bill on account of the NFSA amounted to around ₹2 lakh crore, similar to the newly-announced allocation, but the PMGKAY had effectively doubled that sum for the past two years.

Jal Jeevan Mission: The Centre increased its budgetary allocation for the Jal Jeevan Mission (JJM) or the National Rural Drinking Water Mission by about 27% to ₹70,000 crore from the current year’s revised estimates of ₹55,000. The Jal Jeevan Mission aims to provide safe and adequate drinking water through individual household tap connections by 2024 to all households in rural India.

The Jal Shakti Ministry tweeted last week that the government had provided 11 crore rural households with a tap water connection under the JJM scheme. Data from the Ministry’s dashboard suggest that 56% of the targeted 19.3 crore households had been covered.

The scheme has a total financial outlay of about ₹3.60 lakh crore, with the Centre funding 50% of the cost with States and Union Territories, except for Union Territories without a legislature, where it foots the entire bill, and northeastern and Himalayan States and Union Territories with legislatures, where it funds 90% of the bill.

Ayushman Bharat-PMJAY: The budget for the Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (PMJAY) — the national public health insurance fund, saw an increase of about 12% at ₹7,200 crore compared to the ₹6,000 crore revised estimates for the current year.

The Ayushman Bharat PM-JAY is a health insurance scheme launched in 2018, aiming to provide a health cover of Rs. 5 lakh per family per year for secondary and tertiary care hospitalization. It aims to over 10.74 crore poor and vulnerable families (or 50 crore beneficiaries) from the bottom 40% of the Indian population. Union Health Minister Mansukh Mandaviya had said in December 2022, that 4.5 crore people had so far been empanelled under the scheme.

PM-Kisan: The allocation for the Prime Minister’s Kisan Samman Nidhi (PM-KISAN) scheme was the lowest in five years and remained the same as the revised estimates for the current year at ₹60,000 crore. PM-Kisan is a flagship Central scheme launched in 2019 for cash transfers ₹6,000 per year to eligible farmer families in three instalments of ₹2,000 each.

Finance Minister Nirmala Sitharaman informed while presenting the Union Budget on Wednesday that the government has made cash transfers totalling ₹2.2 lakh crore to around 11 crore farmers under the PM-Kisan scheme.

PM-POSHAN: The government has allocated a budget of ₹11,600 crore to the Pradhan Mantri Poshan Shakti Nirman, or the rebranded version of the mid-day meal scheme for 2023-24. This is down 9.37% from the current year’s revised estimates of ₹12,800.

In 2021, while renaming the mid-day meal scheme to give hot cooked meals to 11.8 crore government school students from Class 1 to 8, the Centre had also decided to extend the scheme to 24 lakh children studying in balvatikas, the pre-primary section of government schools from 2022-23.

National Education Mission: A total of ₹38,965 crore was allocated to the National Education Mission for 2023-24, up 19.44% from the ₹32,612 crore revised estimates for the current year. The Mission is the umbrella scheme integrating major education-related schemes so education can be provided holistically and without segmentation from pre-primary to class 12. It includes the Sarva Shiksha Abhiyan under the Right to Education and schemes for secondary and higher education as well those for teacher training and adult education.

PMAY: The Centre allocated ₹79,590 crore to the Pradhan Mantri Awas Yojana (PMAY), up 3.19% from the current year’s revised estimates and 66% from the budget estimates. The PMAY aims at constructing houses in both urban and rural areas. PMAY-Gramin (rural) was initiated in November 2016 with a target of completing 2.7 crore houses and PMAY-Urban was initiated in June 2015 with a target of constructing 1.2 crore homes.

National Social Assistance Program: The budget allotted ₹9,636 to the National Social Assistance Program (NSAP), which provides monthly pension assistance to the elderly, widows, and persons with disabilities.

Development of Scheduled Tribes and Scheduled Castes: The budget allocated ₹4,295 crore and ₹9,409 crore to the umbrella programs for the development of Scheduled Tribe and Scheduled Caste communities respectively. While the ST development allocation saw a nearly 10% increase, the SC programme funding rose by close to 22%, compared to the current year’s revised estimates.

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