How Is The Budget Made

The annual budget presented by Finance Minister works like a fundamental financial blueprint. It outlines projected government earnings and expenses for the upcoming fiscal year.

The general objective of the Union Budget is to bring about constant, rapid, and balanced economic growth of the country with an eye on equality and social justice. Another of the objectives of the budget is to ensure efficient allocation of resources, and reduce unemployment and poverty.

Also kept in mind while presenting the budget, are aims such as a check on prices and creation of tax structure friendly to the common man. The Constitution's Articles 112 to 117 enshrine the powers of Parliament for enactment of the budget. 

Absence of Majority 

What makes this budget interesting is that this time round, there are strong allies in the government as the BJP didn’t get adequate number of seats for a simple majority in Lok Sabha. This could mean the finance minister would have to accommodate the demands of the coalition partners, especially the Janata Dal (United ) and the Telugu Desam Party, the two key allies who are in the NDA government. 

Finance Minister Sitharaman has had pre-budget interactions with industry leaders, economists, agriculturists, capital and financial markets professionals and leaders of groups representing small and medium enterprises. These meetings help in gauging the mood of different segments of businesses that immensely contribute to the economy of the country.

The Budget Team 

Finance Minister Nirmala Sitharaman is supported in this process of budget-making by a strong team of bureaucrats and economists who start working on the budget almost four to five months ahead of the actual budget presentation.

These domain experts, who have gained experience over the years, chart the strategy for the nation's Budget. Let’s have a look at the Budget team for finasncial year 2024-25.

TV Somanathan, Secretary, Expenditure and Finance 

TV Somanathan, 58, has been the Expenditure Secretary since December 2019. By virtue of his seniority, the 1987-batch Tamil Nadu cadre officer doubles up as the country’s Finance Secretary. A close confidant of Prime Minister Narendra Modi, he has worked in the PMO as a joint secretary and Additional Secretary.

Somanathan joined as Expenditure Secretary in the finance ministry in December 2019. He has been involved in the budget-making process since then. Its his 5th Budget as Secretary, Expenditure. He is considered to be a conservative bureaucrat, who kept the spending of the government under control even during Covid 19, when there was a lot of pressure to spend freely. His current challenge in the budget is to keep the fiscal deficit under control amid spiraling expenses of the government that has a burden of fulfilling different promises made in the last parliamentary elections. 

Ajay Seth, Secretary, Department of Economic Affairs

A 1987-batch Karnataka Cadre IAS officer, Seth holds an engineering degree and an MBA, and is known for his in-depth knowledge of finance and economics. Before he joined the Finance Ministry in mid-2021, he was Managing Director of Bengaluru Metro. Since then, he has been assisting in the budget making process and this is his fourth budget in a row. As the Secretary of Economic Affairs, he leads the charge of Department of Economic Affairs. His job is also to look into a variety of policy functions which include budget and capital markets as well. 

Sanjay Malhotra, Secretary, Revenue 

Sanjay Malhotra is a Rajasthan cadre IAS officer. Before coming to North Block as revenue secretary he was Secretary DFS. He was shifted to the revenue department in December 2022. Under his regime, tax collections have gone up. As revenue secretary, Malhotra  is a key player in the budget process. He is responsible for setting the tax target and following up on it to keep the government kitty full. His major challenge in the budget-making process will be how to maintain the growth in tax collections buoyant. 

Tuhin Kanta Pandey, Secretary, Department of Investment and Public Asset Management

An IAS officer of the 1987-batch Odisha cadre, Tuhin Kanta Pandey has been in the Finance Ministry as Department of Investment and Public Asset Management (DIPAM) Secretary since October 2019, which is almost five years. As DIPAM Secretary, his job is to ensure adequate revenue mobilisation from disinvestment, stake sale and monetisation of PSUs to achieve revenue targets through these means. But, the government has not achieved the divestment target even for one year. The long-pending sale of Air India is a feather in his cap. With PSU stocks doing well in the markets on the back of buoyancy in the economy and robust growth, the pressure of divesting aggressively has been lifted Pandey's shoulders. 

Vivek Joshi, Secretary, Department of Financial Services

Vivek Joshi is a Haryana cadre IAS officer with considerable experience in the Central Government. He was joint secretary, Expenditure in the Finance Ministry from November 2014 to April 2017 and is well versed with how North Block functions. He has been Secretary, Department of Financial Services (DFS) since November 2022. For the budget, his job is to advise on financial and banking issues. His overall mandate in the government is to look after the functioning of banks, financial institutions, insurance companies and the National Pension System.

V Anantha Nageswaran, Chief Economic Advisor

A mild-mannered and media-shy man, it is said, V Anantha Nageswaran was handpicked by Finance Minister Sitharaman herself. Known as a renowned economist in the circuit, he is an MBA from IIM Ahmedabad and was teaching in Singapore before he joined as CEA in January 2022. 

The job of the CEA, who holds a rank equivalent to a Secretary, Government of India, is to advise in the Finance Ministry on economic issues and Nageswaran is solely responsible for the Economic Survey, which is tabled in Parliament a day before the budget.