Union Budget 2024: Nirmala Sitharaman, team giving finishing touches as Interim Budget enters last lap

The preparation of the Interim Budget 2024 has entered the last lap with Finance Minister Nirmala Sitharaman and her team of top Finance Ministry officials giving the final touches to the document as North Block has been put in lock-down mode to ensure complete secrecy after the 'halwa ceremony'.

According to sources, there is a lot of back and forth with the team of PMO officials headed by P.K. Mishra, Principal Secretary to the Prime Minister, and the Finance Ministry officials.
These discussions ensure that the thrust of the schemes drawn up by the Prime Minister with his close understanding of the ground realities, are adequately presented in the fine-print of the budget.

Finance Secretary TV Somanathan, a Tamil Nadu cadre officer who served as additional secretary in the Prime Minister's Office (PMO) before joining the Finance Ministry, is a key link between the two teams.

The top members of Finance Minister Nirmala Sitharaman's team spearheading the budget-making exercise in the ministry include Sanjay Malhotra, the Revenue Secretary, Ajay Seth, Secretary of the Department of Economic Affairs, Tuhin Kanta Pandey, Secretary of the Department of Investment and Public Asset Management, Vivek Joshi, Secretary of the Department of Financial Services and V Anantha Nageswaran, the Chief Economic Advisor.

During the printing of the Union Budget in North Block, most officials have to stay put in the office with no communication with the outside world during the days ahead of the budget. It is only after the budget is presented on Feb1 that they will be allowed to go home.

The last week is the culmination of a 6-month budget preparation exercise in which all the ministries such as agriculture, rural development, industry, power, highways and ports prepare their estimates and present them to the Finance Ministry.

The Finance Minister assisted by her team then goes through the proposals and puts them together in close consultation with the PMO taking into account the overall fiscal deficit and the relative allocations that have to be made with the government policies aimed at pushing growth and inclusive development.

Sitharaman is poised to present the interim budget for the fiscal year 2024-25 on February 1, making her only the second finance minister of the country to present a budget in Parliament for the sixth time in a row after Morarji Desai.

The full budget for 2023-24 will be presented after the formation of the new government following the 2024 general elections.

An Interim Budget is presented by a government that is in its last year in office ahead of the Lok Sabha elections.

The need for an interim budget arises because a fresh approval is required from Parliament to withdraw money from the Consolidated Fund of India to run the government as the existing 2023-24 Budget is valid only till March 31 this year.

Since the Lok Sabha elections are being held in April-May this year, funds will be required to run the country till the new government takes over. The interim budget is a practical arrangement that enables the government to fill this gap.

An Interim Budget is similar to a Union Budget in that ruling government tables in Parliament the estimates of its expenditure, revenue, fiscal deficit and financial performance and projections for the upcoming financial year.

Although major tax proposals are not made, the ruling government can tweak some taxes as it did when it raised the income tax deduction limit to give salaried professionals some relief ahead of the 2019 Lok Sabha elections.

The government does not make any major policy announcements during the Interim Budget which could financially burden the next elected government that will present the full Union Budget.

According to the Election Commission's Code of Conduct, the government cannot include any major scheme in the Interim Budget as it could influence voters.

The government also does not present the Economic Survey along with the Interim Budget which is done a day before the presentation of the main budget.