On Wednesday, Union Finance Minister Nirmala Sitharaman will present the last full budget of the Modi 2.0 government. Expectations are high, like every year. Since this will be the last full Budget before the 2024 general elections, Nirmala Sitharaman may announce income tax relief for salary earners, and people in small businesses. Inflation and a jobs crisis have significant issues in recent times.
This is 2023. But do you know who presented the first budget for independent India? And why was it presented at 5 pm? And why was there an air of secrecy around the process? And about the scandal that broke after budget details were leaked?
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The Union finance minister, who presented the first budget (1947-48) for Independent India, was Sir RK Shanmukham Chetty. He was not a Congress leader. He was a pro-British Justice Party leader. He was also an industrialist, a former Diwan of Cochin state and the constitutional adviser to the Chamber of Princes.
The total expenditure under the budget was earmarked at Rs 197.39 crore, out of which approximately Rs 92.74 crore (or 46 percent) was allocated for defence services.
In those days, the budget for India was presented at 5 pm. This was because politicians and officials wanted their counterparts in Britain to follow the details comfortably. 5 pm in India was and is noon in the UK.
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As it happened, UK Chancellor of the Exchequer Hugh Dalton casually informed a journalist about some tax changes proposed by India in the budget. The journalist published the details before Chetty’s budget speech in the Indian Parliament. This forced Dalton to put in his papers. Secrecy became a hallmark of India’s budget preparations.
These days, the government presents budgets on the first day of February so that it could be materialised before the beginning of the new financial year in April. Until 2016 it was presented on the last working day of February by the finance minister in Parliament.
As per Article 112 of the Constitution, the budget is an annual financial statement, a statement of accounts that provides details of the revenue earned or expected to be earned, and expenditure the government made in the past year or intends to make in the year ahead.
