by Budgetary procedure and financial control in India refer to the process through which the government of India prepares, approves, implements, and evaluates its budget. The budgetary procedure is a crucial aspect of fiscal management in India as it provides the framework for the allocation and management of financial resources.
The budgetary procedure and financial control in India are crucial for ensuring that the government’s financial resources are being used efficiently and effectively. The process involves multiple stakeholders, including the Parliament, the Ministry of Finance, the CAG, and various departments and ministries of the government. The goal is to ensure that the government is able to meet its objectives while maintaining fiscal discipline and responsibility.
Here are the key details:
Budget formulation: The budget formulation process in India starts with the preparation of estimates by various departments and ministries of the government. The Ministry of Finance then consolidates these estimates and prepares a draft budget that is presented to the Parliament in the form of the Annual Financial Statement.
Budget approval: The budget is subject to approval by the Parliament. The Parliament can either approve the budget as presented or make changes to it through the Finance Bill. Once the budget is approved, it becomes law, and the government can start implementing it.
Budget execution: The budget execution process involves the allocation and disbursement of funds to various departments and ministries of the government. The Ministry of Finance monitors the spending of these funds to ensure that they are being used for their intended purposes.
Financial control: Financial control refers to the mechanisms through which the government ensures that financial resources are being used efficiently and effectively. The Comptroller and Auditor General (CAG) of India is responsible for auditing the accounts of the government and reporting any irregularities or discrepancies to the Parliament. The CAG also conducts performance audits to evaluate the effectiveness of government programs.
Fiscal responsibility: Fiscal responsibility refers to the government’s commitment to maintaining a sustainable fiscal position. The Fiscal Responsibility and Budget Management (FRBM) Act, 2003 is an important legislation that aims to promote fiscal discipline and ensure sustainable debt levels for the government. The FRBM Act sets targets for the government’s fiscal deficit, revenue deficit, and debt levels.
