The Budget is prepared by the ministry of Finance ant the union budget is presented by the Finance Minister. Our constitution has made it compulsory that every year The Budget is presented before the Parliament . The overall responsibility of preparing the budget lies with the Ministry of Finance. Various departments of this ministry work for several months to prepare the budget. Each department has a specific responsibility. The departments are: Department of Expenditure, Department of economic affairs, Department of Revenue. The Budget is officially called the Annual Financial Statement. The Union Government (or the center) prepares the Union Budget. The State Government prepares their respective budgets. Besides there is a specific and independent budget for the Indian Railways . The Indian Railways is the largest public sector and therefore it has its own budget. How the Budget is prepared?
The budget division which is a part of the Department of Economic Affairs (of the Finance Ministry) issues a budget circular to all ministries of the Center, all states and Union Territories. The circular is also sent to all autonomous bodies and department. The circular is also sent to the 3 arms of the Defence Ministry ( Army, Navy and Airforce). Each of these is asked to prepare a revised estimate for the current financial year. After the response is received, follows a series of pre budget meetings. Extensive consultations take place. Several meetings are also held with representatives from various sectors of the economy. The Ministry of Finance has several rounds of meetings with Labour unions, Farmers, Economist, representatives of the business community, members of the civil society. Based on the suggestions and feedback, draft of the budget is prepared. The Finance Ministry is also strongly influenced by political factor. The Government of the day was the budget to...
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