Interim Budget may be bigger than FY19

The Centre is all set to breach its promise to keep the Budget size smaller as a percentage of GDP. Bucking the trend, Finance Minister Piyush Goyal’s interim Budget may be bigger in size than last year’s general Budget (FY19) which was a little below Rs 24.5 lakh crore.

The actual expenditure outlay in the Budget may be for three to four months but the projections will be made for the full year, sending a signal to stakeholders and investors that if the similar dispensation returns, it will stick to its promise.

Among the benefits are the farm sector relief package costing Rs 1.25 lakh crore, a package for startups ranging up to Rs 200 crore and an undisclosed but substantial amount for women and youth of the country, an official close to the development told DH.

The benefits to the farm sector could be in the form of direct fund transfer into their accounts combined with interest-free loans to the bottom over 80% marginal farmers, whose landholdings are minuscule.

Other expenses will be in the form of increased outlay for various sectors like agriculture, rural development with a special focus on MNREGS and railways, all of which have given their requirement for the central assistance for the entire financial year 2019-20.

 “This will be an interim Budget like never before,” he said taking a cue from Union Minister Arun Jaitley’s comment that the government would work in the larger interest of the economy and could go beyond the convention of an election-year Budget.

The move comes amid a consistent effort by the Centre to bring down the size of Union Budget as a percentage of the GDP every year. The general Budget was brought down from 14.2% in 2013 to 12.7% in 2018.

It was expected to come down further this year but the Modi government in its last-ditch effort to appease voters, is all set to open its purse strings, throwing the rule books out of the window, sources said.