Union Budget 2025 | FAQs: What is Demand for Grants?

As we near the Budget say, let's take a look at what 'Demand for Grants', a term associated with the exercise, means.

The Union Budget for the upcoming financial year is all set to be presented on February 1, 2025, by Finance Minister Nirmala Sitharaman. According to reports, the Narendra Modi government may consider slashing income tax for individuals earning up to Rs 15 lakhs per annum and extend the tax relief bracket in a bid to provide relief to the middle class and boost consumption.

As we near the Budget day, let's take a look at what 'Demand for Grants', a term associated with the exercise, means.

What is Demand for Grants?

"Demand for Grants" is a formal request for funds made by various ministries or departments of the government. It is part of the annual budgetary process and is presented to the Lok Sabha. Here are some key aspects of the Demand for Grants:

Budget Presentation: The Union Budget, which includes the Demand for Grants, is presented by the Finance Minister. It outlines the estimated expenditures of the central government for the upcoming financial year.

Departmental Demands: Each ministry or department of the government prepares a detailed estimate of its expenses for the next fiscal year. These are compiled into individual demands for grants.

Scrutiny by Committees: The demands are often scrutinized by various Parliamentary Committees. These committees examine the demands in detail and can recommend modifications or cuts.

Discussion and Approval: The demands for grants are then discussed by the Lok Sabha. Members of Parliament (MPs) have the opportunity to discuss the merits and particulars of the demands. The Lok Sabha must approve each demand, and it has the power to assent, reduce, or reject a demand.

Cut Motions: MPs can propose cut motions, which are formal objections to a demand. There are three types of cut motions: Disapproval of Policy Cut, Economy Cut, and Token Cut. These motions allow MPs to express their disagreement with certain aspects of the budgetary allocations.

Passing of the Budget: Once the demands for grants are approved (with or without modifications), they become part of the Appropriation Bill. The Bill, once passed, allows the government to withdraw funds from the Consolidated Fund of India to meet its expenses and liabilities.

Guillotine: Due to time constraints, not all demands for grants can be discussed individually in the Lok Sabha. On the last day allotted for the discussion of demands, the Speaker applies a "guillotine," meaning that all outstanding demands are put to vote at once, without discussion.

The Demand for Grants is a crucial part of the budgetary process in India, reflecting the financial requirements of the government and ensuring parliamentary control over public expenditure.

(Disclaimer: This copy has been written by a generative AI tool and has been reviewed and edited by the DH Web Desk)