general

A detailed analysis of the budgets of two consecutive years helps to understand the government's
priorities, policies, and direction. It can also provide insights into the economy's health, sectoral
growth, and overall development.

In general, some key areas that are often compared between two consecutive budgets include:

Total expenditure: This is the amount of money the government plans to spend in a fiscal year. A
comparison of the total expenditure between two budgets can show how the government's
spending priorities have shifted.

Revenue sources: The revenue sources for the government include taxes, fees, and other sources of
income. A comparison of the revenue sources between two budgets can show how the government
plans to generate revenue and whether there are any changes in the tax rates.

Fiscal deficit: This is the difference between the government's total expenditure and total revenue. A
comparison of the fiscal deficit between two budgets can show whether the government is planning
to increase or decrease its borrowing.

Sectoral allocation: The government allocates funds for various sectors like agriculture, education,
health, infrastructure, etc. A comparison of sectoral allocations between two budgets can show
whether the government is giving priority to certain sectors and whether there are any changes in
the allocation pattern.

In conclusion, a detailed analysis of the budgets of 2022 and 2023 for India can provide useful
insights into the government's priorities, policies, and direction, and help understand the economy's
health and overall development.

budget 2022

The key highlights of the budget are:

The total expenditure for the fiscal year 2022-23 is estimated to be Rs. 41.05 lakh crore, which
includes a capital expenditure of Rs. 5.54 lakh crore.

The revenue receipts for the year 2022-23 are estimated to be Rs. 19.19 lakh crore, while the fiscal
deficit is estimated to be 6.8% of the Gross Domestic Product (GDP).

The government announced a new tax policy that aims to simplify the tax system and reduce the
compliance burden on taxpayers. The policy includes measures such as faceless assessment, faceless
appeal, and the introduction of a taxpayer's charter.

The government has allocated funds for various sectors, including Rs. 1.97 lakh crore for the
healthcare sector, Rs. 1.10 lakh crore for the education sector, and Rs. 1.18 lakh crore for the rural
development sector.

The government has announced a Rs. 6,000 crore investment in the National Infrastructure Pipeline
(NIP) to boost infrastructure development in the country.

The government has proposed to increase the Foreign Direct Investment (FDI) limit in the insurance
sector from 49% to 74%.
The government has also announced several other measures such as a new national logistics policy,
the launch of a new financial institution to fund infrastructure projects, and the creation of a single
securities market code.

Overall, the 2022 Union Budget of India aims to boost economic growth, support various sectors,
simplify the tax system, and improve infrastructure development in the country.

Budget 2023

Expectations:
It is expected that the Union Budget for 2023-24 will focus on measures to boost economic growth,
create jobs, promote entrepreneurship, and support various sectors, such as healthcare, education,
agriculture, and infrastructure. The budget may also include measures to address some of the key
challenges facing the economy, such as inflation, rising fuel prices, and the impact of the COVID-19
pandemic.

The budget is also likely to continue the government's efforts to simplify the tax system and reduce
the compliance burden on taxpayers. It may also include measures to promote foreign investment,
support small and medium-sized enterprises, and improve the ease of doing business in India.

Overall, the Union Budget for 2023-24 is expected to be closely watched by businesses, investors,
and individuals in India and around the world, as it will provide insights into the government's
priorities, policies, and direction for the upcoming fiscal year.

Budget 2023 was under heavy scrutiny even before it saw the light of day. In fact, it
won’t be an exaggeration to say that Budget 2023 received the most scrutiny, due to the
fact that it’s going to be an election year budget, combined with the fact that most
economists are expecting an economic downturn next year. Opposition leaders called
it an election budget, a budget that will be used to serve the ruling party for the
elections, experts called it a populist budget, and some also expected it to be a recovery
budget.

ACTUAL:

COMPARE:

Macroeconomic fundamentals:

 On the path of fiscal consolidation with reducing deficits (primary, fiscal and revenue)
 4x increase in capex of union govt
 Asset quality improvement in banks; lesser NPAs
 Sufficiency of forex reserves to cover 9 months of imports
 Convergence of WPI and CPI-C
 Increase in revenue receipts and capital receipts as well as revenue expenditure and capital
expenditure

Growth remains resilient with real GDP on a significant rise

Urban unemployment is at a 4 year low
Increasing expenditure on health and education
More credit to agricultural sector
 High record of foodgrain production
Change in tax slabs; surcharge; rebate
Allocation to major schemes (in crores)
2022-23 2023-24
Development of pharma 100 1250
Jal Jeevan mission 60,000 70,000
Eklavya model residential schools 2000 5943
Pradhan mantri awas yojna 48000 79950
FAME 2908 5172
NE infra development 1419 2491

(PRS PDF- https://prsindia.org/files/budget/budget_parliament/2023/Union_Budget_Analysis-2023-

24.pdf )

Budget estimates of 2023-24 as compared to revised estimates of 2022-23

Total Expenditure: The government is estimated to spend Rs 45,03,097 crore in 2023-24. This is an
increase of 7.5% over the revised estimate of 2022-23. Out of the total expenditure, revenue
expenditure is estimated to be Rs 35,02,136 crore (1.2% increase) and capital expenditure is
estimated to be Rs 10,00,961 crore (37.4% increase). The increase in capital expenditure is due to an
increase in capital outlay on transport (including railways, roads and bridges, and inland water
transport) by Rs 1,28,863 crore (36.1% increase). Expenditure on total capital outlay is estimated to
be Rs 8,37,127 crore in 2023-24, an increase of 35% over the revised estimates for 2022-23.

Total Receipts: Government receipts (excluding borrowings) are estimated to be Rs 27,16,281 crore,
an increase of 11.7% over the revised estimates of 2022-23. The gap between these receipts and the
expenditure will be plugged by borrowings, budgeted to be Rs 17,86,816 crore, an increase of 1.8%
over the revised estimate of 2022-23.

Transfer to states: The central government will transfer Rs 18,62,874 crore to states and union
territories in 2023-24, an increase of 8.9% over the revised estimates of 2022-23. Transfer to states
includes devolution of Rs 10,21,448 crore out of the divisible pool of central taxes, grants worth Rs
6,86,773 crore, and special loans worth Rs 1.3 lakh crore for capital expenditure.

Deficits: Revenue deficit is targeted at 2.9% of GDP, and fiscal deficit is targeted at 5.9% of GDP in
2023-24. The target for primary deficit (which is fiscal deficit excluding interest payments) in 2023-24
is 2.3% of GDP. The revised estimate for the revenue deficit target has increased from the budgeted
estimate in 2022-23. The revised fiscal deficit target for 2022-23 has remained the same, despite
higher receipts. In 2022-23, the central government’s revenue deficit is expected to be 4.1% of GDP
against a budget estimate of 3.8% of GDP.

GDP growth estimate: The nominal GDP is estimated to grow at a rate of 10.5% in 2023-24.

Expenses which bring a change to the government’s assets or liabilities (such as construction of
roads or recovery of loans) are capital expenses, and all other expenses are revenue expenses (such
as payment of salaries or interest payments). In 2023-24, capital expenditure is expected to increase
by 37.4% over the revised estimates of 2022-23, to Rs 10,00,961 crore. Revenue expenditure is
expected to increase by 1.2% over the revised estimates of 2022-23 to Rs 35,02,136 crore.
Disinvestment is the government selling its stakes in Public Sector Undertakings (PSUs). In 2022-23,
the government is estimated to meet 77% of its disinvestment target (Rs 50,000 crore against a
target of Rs 65,000 crore). The disinvestment target for 2023-24 is Rs 51,000 crore

ADDA (https://currentaffairs.adda247.com/union-budget-2023-vs-union-budget-2022/
#:~:text=The%20target%20fiscal%20deficit%20for,an%20increase%20of%205.7%25).

Key points

Five instead of six tax slabs are now available. When income surpasses Rs 5 crore, a surcharge of
37% will be replaced with a 25% surcharge.

A rebate and no taxes are already available to persons with incomes up to Rs 5 lakh; this maximum
has been increased to Rs 7 lakh. Additionally, under the new tax system, the standard deduction will
be accessible.

The tax exemption for news organisations established only for the gathering and dissemination of
news will be eliminated.

For income tax exemption, charitable trusts must use 85% of their income during the year.

As of April 2023, only 85% of a donation made by a charity trust to another charitable trust would be
counted as income.

For MSMEs to qualify for presumed taxes, the threshold for turnover has increased from Rs 2 crore to
Rs 3 crore.

For professionals who are subject to presumed taxes, the upper limit on gross revenues has increased
from Rs. 50 lakh to Rs. 75 lakh.

For new cooperative societies that engage in manufacturing operations, the income tax rate has
been reduced from 22% to 15% (with a 10% surcharge).

To the extent that another residential property is purchased or built, capital gains from the sale of
one residential property may be deducted. The deduction’s maximum amount is Rs 10 crore.

If a premium of Rs. 5 lakh was paid in any year, the income from investments in life insurance policies
will be taxed. The sum that is paid when a policyholder passes away will still be free from income tax.

Online gaming winnings are subject to 30% tax deductibility at source.

Startups that are established within the timeframe and satisfy other requirements may deduct up to
100% of their profits; the deadline for doing so has been moved from March 31 to March 31 of the
following year.

Additionally, the time frame for carrying forward initial losses has been increased from seven to ten
years

Expenditure: In 2023–24, the government plans to spend Rs 45,03,097 crore, a 7.5% increase above
the updated estimate for 2022–23. The total spending for 2022–23 is anticipated to be 6.1% higher
than anticipated in the budget

Receipts: It is anticipated that receipts (other than borrowings) will total Rs 27,16,281 crore in 2023–
24, an increase of 11.7% from the revised projection for 2022–23. The total receipts (excluding
borrowings) are anticipated to be 6.5% higher in 2022–23 than projected in the budget
The target revenue deficit for 2023–24 is 2.9% of GDP, which is less than the previously estimated
4.1% for 2022–23. The target fiscal deficit for 2023–24 is 5.9% of GDP, which is less than the
previously estimated 6.4% for 2022–23. Although the revised estimate was identical to the budget
projection in terms of GDP, the fiscal deficit in 2022–23 was higher in nominal terms by Rs 94,123
crore (an increase of 5.7%). An estimated 41% of revenue revenues, or Rs 10,79,971 crore, will be
spent on interest.

Critique:
From revamped credit push to infra development: Budget 2023 showed the government’s commitment to growth with a
significant capex outlay of Rs 10 lakh crore, the highest ever and translating to a 33% hike.
positves- https://economictimes.indiatimes.com/small-biz/sme-sector/budget-2023-from-
revamped-credit-push-to-infra-development-industry-stakeholders-react/articleshow/
97548698.cms

https://www.livemint.com/budget/budget-2023-reactions-business-leaders-respond-to-budget-
11675219981043.html

summarised views: https://www.businesstoday.in/union-budget/budget-2023-reactions

negative: https://www.thehindu.com/business/budget/union-budget-2023-political-reactions-live-
updates/article66457165.ece

PIB HIGHLIGHTS (https://pib.gov.in/newsite/infographicss.aspx?mincode=15&Event_Code=8)