Tuesday, May 28th, 2024

RAJIV RANJAN’S ANALYSIS : Interim Budget 2024 — in campaign mode

Analyst is National president, All India Manufacturer’s Organization, Chairman, National clusters development council.

New Delhi (India), February 16: The Finance Minister presented her sixth consecutive Budget.

The Finance minister presented an interim budget, rather than a comprehensive annual budget due to National Elections.


The government’s blueprint on


taxes it plans to levy

other transactions which affect the economy and lives of citizens.

Article 112 of the Indian Constitution: Union Budget of a year is referred to as the Annual Financial Statement (AFS).

The Budget Division of the Department of Economic Affairs in the Finance Ministry is the nodal body responsible for preparing the Budget.

Components of the Budget:



deficit indicators.

Depending on the manner in which they are defined, there can be many classifications and indicators of expenditure, receipts and deficits.

Interim Budget:

A vote on account, also known as interim Budget, means that the government seeks the approval of Parliament for meeting expenditure for the first four months of the fiscal year (April-March)

paying salaries, ongoing programmes in various sectors etc — with no changes in the taxation structure

Until a new government takes over and presents a full Budget that is revised for the full fiscal.

Key Highlights:


Government will launch a scheme to help deserving sections of the middle class “living in rented houses, or slums, or chawls and unauthorized colonies” to buy or build their own houses.

Rooftop solarization — one crore households will be enabled to obtain up to 300 units free electricity every month. “

PM Awas Yojana (Grameen)– Two crore more houses will be taken up in the next five years to meet the requirement arising from increase in the number of families.


Vaccination for girls in the age group of 9 to 14 years for prevention of cervical cancer.

Government plans to set up more medical colleges by utilizing the existing hospital infrastructure under various departments.

Upgradation of anganwadi centers under “Saksham Anganwadi and Poshan 2.0” will be expedited.

U-WIN platform for managing immunization and intensified efforts of Mission Indradhanush will be rolled out expeditiously.

Extension of healthcare cover under Ayushman Bharat scheme to all ASHA workers, Anganwadi Workers and Helpers.

Agriculture and related sectors

Application of Nano DAP on various crops will be expanded in all agro-climatic zones.

A strategy will be formulated to achieve ‘atmanirbharta for oil seeds.

Focussed oil seeds: mustard, groundnut, sesame, soybean, and sunflower.

A comprehensive programme for supporting dairy farmers will be formulated.

The success of existing schemes such Rashtriya Gokul Mission, National Livestock Mission, and Infrastructure Development Funds for dairy processing and animal husbandry will act as guiding light for such a programme.

Implementation of Pradhan Mantri Matsya Sampada Yojana (PMMSY)will be stepped up to:

enhance aquaculture productivity from existing 3 to
5 tons per hectare

double exports to ` 1 lakh crore

generate 55 lakh employment opportunities in the near future.”

Five integrated aqua parks will be setup.


Eighty-three lakh SHGs:The government aims to enhance the target for Lakhpati Didifrom 2 crore to 3 crore.

Youth And Technology

For the tech savvy youth — A corpus of rupees one lakh crore will be established with fifty-year interest free loan.

The corpus will provide long-term financing or refinancing with long tenors and low or nil interest rates.

A new scheme will be launched for strengthening deep-tech technologies for defense purposes and expediting atma nirbharta.

Infrastructure Development

The outlay for the next year is being increased by 1 percent.

This would be 4 percent of the GDP.

Three major economic railway corridor programmes will be implemented. These are:

energy, mineral and cement corridors

port connectivity corridors

high traffic density corridors.

The projects have been identified under the PM Gati Shakti for enabling multi-modal connectivity.

Expansion of Metro and NaMO Bharat will be supported in large cities focusing on transit-oriented development.

Environment and Green Energy:

Viability gap funding will be provided for harnessing offshore wind energy potential.

Coal gasification and liquefaction capacity of 100 MT will be set up by 2030.

Financial assistance will be provided for procurement of biomass aggregation machinery.

Phased mandatory blending of compressed biogas (CBG) in compressed natural gas (CNG) for transport and piped natural gas (PNG) for domestic purposes will be mandated.

Electric Vehicle Ecosystem–Support for manufacturing and charging infrastructure.

Greater adoption of e-buses for public transport networks will be encouraged through payment security mechanisms.

For promoting green growth, a new scheme of bio-manufacturing and bio-foundry will be launched.

Blue Economy 2.0: A scheme for restoration and adaptation measures, and coastal aquaculture and mariculture with integrated and multi-sectoral approach will be launched.


States will be encouraged to take up comprehensive development of iconic tourist centers, branding and marketing them at global scale.

A framework for rating of the centers based on quality of facilities and services will be established.

Long-term interest free loans will be provided to States for financing such development on a matching basis.

For domestic tourism— projects for port connectivity, tourism infrastructure, and amenities will be taken up on our islands. It will also include Lakshadweep.


The FDI inflow during 2014-23 was USD 596 billion marking a golden era.

That is twice the inflow during 2005-14.

Negotiating bilateral investment treaties with the foreign partners, in the spirit of ‘first develop India’.

Population Growth and Demographic changes:

The Government will form a high-powered committee for an extensive consideration of the challenges

Reforms in the States 

 A provision of seventy-five thousand crore rupees as a fifty-year interest free loan is proposed this year to support reforms by the State Governments.

Revised Estimates 2023-24:

The Revised Estimate of the total receipts other than borrowings is Rs. 27.56 lakh crore, of which the tax receipts are 23.24 lakh crore.

The Revised Estimate of the total expenditure is Rs. 44.90 lakh crore.

The revenue receipts at Rs. 30.03 lakh crore are expected to be higher than the Budget Estimate.

The Revised Estimate of the fiscal deficit is 5.8 percent of GDP

Budget Estimates 2024-25:

The fiscal deficit in 2024-25 is estimated to be 5.1 percent of GDP, adhering to that path.

The scheme of fifty-year interest free loan for capital expenditure to states will be continued this year with a total outlay of Rs. 1.3 lakh crore.

The total receipts other than borrowings and the total expenditure are estimated at Rs. 30.80 and 47.66 lakh crore respectively.

The tax receipts are estimated at Rs. 26.02 lakh crore.

Direct taxes:

The direct tax collections(last ten years)have more than trebled and the return filers swelled to 2.4 times.

Under the new tax scheme, there is now no tax liability for taxpayers with income up to Rs. 7 lakh, up from Rs. 2.2 lakh in the financial year 2013-14.

The threshold for presumptive taxation for retail businesses was increased from Rs. 2 crore to Rs. 3 crore.

The threshold for professionals eligible for presumptive taxation was increased from Rs. 50 lakh to Rs. 75 Lakh.

Corporate tax rate was decreased from 30 percent to 22 percent for existing domestic companies and to 15 percent for certain new manufacturing companies.

The age-old jurisdiction-based assessment system was transformed with the introduction of Faceless Assessment and Appeal, thereby imparting greater efficiency, transparency and accountability.

ntroduction of updated income tax returns, a new Form 26AS and prefilling of tax returns have made filing of tax returns simpler and easier.

Average processing time of returns has been reduced from 93 days in the year 2013-14 to a mere ten days this year, thereby making refunds faster.

Indirect Taxes:

GST has reduced the compliance burden on trade and industry

Tax base of GST more than doubled

The average monthly gross GST collection has almost doubled to Rs. 1.66 lakh crore.

States’ SGST revenue, including compensation released to states, in the post-GST period of 2017-18 to 2022-23, has achieved a buoyancy of 1.22.

Number of steps were taken in Customs to facilitate international trade.

Tax Proposals:

No changes relating to taxation — same tax rates for direct taxes and indirect taxes including import duties.

Withdrawal of outstanding direct tax demands (petty, non-verified, non-reconciled or disputed direct tax demands, many of them dating as far back as the year 1962) up to twenty-five thousand rupees (Rs 25,000)

pertaining to the period up to financial year 2009-10 and up to ten-thousand rupees (Rs 10,000) for financial years 2010-11 to 2014-15.

Part A of the Budget:

It is about recounting of policies already adopted, and to be adopted

The Interim Budget focuses on all the “welfare” schemes, in areas varying from housing to food.

Part B of budget:

While pursuing consolidation in the sense of achieving periodically revised fiscal deficit to GDP ratios

The government will be stepping up spending on infrastructure and welfare.

Controller General of Accounts(CGA) data:

●      It substantiated estimates of actual expenditure for the first three quarters of 2023-24 provided by the (CGA),

●      Estimates for the Department of Rural Development(MGNREGA falls under it) scheme: As compared to budgeted expenditures of ₹1,57,545 crore for 2023-24

○      The revised estimates are placed at a much higher ₹1,71,069 crore. 

Expenditure of the Department of Rural Development(December 2023) amounted to only 63% of the total projected in the revised estimates.

Department of Agriculture and Farmers Welfare(Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) scheme: The budgeted expenditure for 2023-24 for that department was placed at ₹1,15,532 crore and the revised estimate is projected at ₹1,16,789 crore.

The actual(December 2023) is placed at 61% of the revised estimate.

The explanation for the hefty increase is that income from dividends and profits is slated to rise from ₹99,913 crore in 2022-23 to ₹1,54,407 crore in 2023-24 (RE).

The revised estimates suggest that the actual inflow will be more than twice that figure at ₹1,04,407 crore, largely because of transfers from the central bank.

Capital receipts, consisting of receipts from disinvestment from a budgeted ₹61,000 crore to ₹30,000 crore.

The CGA estimates that ‘other non-debt capital receipts’, consisting of disinvestment proceeds, just crossed ₹10,000 crore by December.

Possible Reasons for such deviations between actual spending and the revised estimates in the Budget:

The Finance Minister has chosen to inflate revised estimates of spending to back her claim that the government has provided massive support to farmers and rural workers.

The government plans to launch a pre-election spending blitz in areas where it believes it can swing votes.

Spending on the MGNREGA scheme suggests that the government believes that rhetoric can be a substitute for actual allocations.

Way Forward

At the macroeconomic level, the Budget’s claim is that in 2023-24, the central government has managed to ensure that its receipts other than borrowing are almost equal to that budgeted.

It has met budgetary expectations with respect to tax revenues as well as expects to raise its non-tax revenue receipts by 25% relative to budget.

There is a need to create an enabling environment for businesses to thrive, the focus on environment-related issues, and the upliftment of the marginalized section of society

Focus on the quality of growth to ensure that it is equitable, sustainable and green.