Government Budgeting - India and Odisha

The basics of government budgeting in India, specifically focusing on Odisha:

Understanding Government Budgeting

• Purpose: Government budgets outline how public funds will be collected and spent to achieve policy goals and meet the needs of citizens.

• Structure: Budgets have two main components:

  • Revenue: Money the government earns (taxes, fees, investments, etc.)

  • Expenditure: Money the government spends (salaries, infrastructure, welfare, etc.)

Budgeting in India

• Federal System: India has a multi-tiered structure:

  • Union Government (Central): Responsible for national-level policies (defense, railways, etc.).

  • State Governments (Odisha): Responsible for regional matters (education, healthcare, etc.). Each state has its own budget.

  • Local Governments: Have smaller budgets for municipal functions within cities or districts.

• Budgetary Cycle:

  1. Preparation: Government departments submit expenditure proposals to the Finance Ministry.

  2. Presentation: Finance Minister presents the budget in Parliament (Lok Sabha).

  3. Approval: Parliament debates and votes on the budget.

  4. Implementation: Approved budget is put into action.

  5. Audit: Comptroller and Auditor General (CAG) audits government spending for accountability.

Budgeting in Odisha

• Fiscal Responsibility: Odisha adheres to the Fiscal Responsibility and Budget Management (FRBM) Act, seeking to maintain fiscal discipline.

• Key Features:

  • Focus on social sectors: Education, healthcare, and rural development are priorities.

  • Capital Expenditure: Emphasis on infrastructure development to boost economic growth.

  • Debt Management: Maintains a sustainable debt position.

  Recent Trends:

  • Increasing Budget Size: Odisha's budget has grown significantly, reflecting economic and developmental progress.

  • Welfare Initiatives: Numerous welfare programs benefit various sectors of society.

Budgetary Challenges

• Resource Allocation: Balancing spending needs with limited revenues across various sectors.

• Revenue Generation: Increasing revenue sources beyond central transfers.

• Inefficiencies: Improving the efficiency of spending for maximum impact.

• Transparency and Accountability: Ensuring public funds are used responsibly.

Sources for Information

• Odisha State Budget: https://budget.odisha.gov.in/

• Union Budget of India: https://www.indiabudget.gov.in/

• PRS Legislative Research (for budget analysis): https://prsindia.org/budgets/states/odisha-budget-analysis-2023-24

Government budgeting in India, specifically focusing on Odisha: