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Budget 2020-21
Arthanomics Series
Page 2


Budget 2020-21
Arthanomics Series
What will we cover
Key to Budget Documents 
A glance at various receipts and expenditures 
Various deficit statistics  
Budget Profile 
Prominent themes of the budget
Page 3


Budget 2020-21
Arthanomics Series
What will we cover
Key to Budget Documents 
A glance at various receipts and expenditures 
Various deficit statistics  
Budget Profile 
Prominent themes of the budget
Key to Budget Documents
1. Annual Financial Statement(AFS) 
-
The document as provided under Article 112, shows the estimated receipts 
and expenditure of GOI for 2020-21 in relation to estimates for 2019-20 as 
also actual expenditure for the year 2018-19. 
-
These receipts and expenditure are shown under 3 parts: (a) Consolidated 
Fund of India; (b) Contingency Fund of India; (c) Public Account of India. 
-
The AFS has to distinguish the expenditure on revenue account from 
expenditure on other accounts(capital). 
2. Demand for Grants(DG) 
-
Article 113 of the constitution mandates that the estimates of expenditure 
from Consolidated Fund included in AFS and required to be voted by Lok 
Sabha, be submitted in the form of Demand for Grants. 
-
Each demand initially gives separately the totals of : (a) Voted and Charged 
expenditure; (b) Revenue and Capital Expenditure; (c) Grand total on gross 
basis on the amount of expenditure for which demand is presented.
Page 4


Budget 2020-21
Arthanomics Series
What will we cover
Key to Budget Documents 
A glance at various receipts and expenditures 
Various deficit statistics  
Budget Profile 
Prominent themes of the budget
Key to Budget Documents
1. Annual Financial Statement(AFS) 
-
The document as provided under Article 112, shows the estimated receipts 
and expenditure of GOI for 2020-21 in relation to estimates for 2019-20 as 
also actual expenditure for the year 2018-19. 
-
These receipts and expenditure are shown under 3 parts: (a) Consolidated 
Fund of India; (b) Contingency Fund of India; (c) Public Account of India. 
-
The AFS has to distinguish the expenditure on revenue account from 
expenditure on other accounts(capital). 
2. Demand for Grants(DG) 
-
Article 113 of the constitution mandates that the estimates of expenditure 
from Consolidated Fund included in AFS and required to be voted by Lok 
Sabha, be submitted in the form of Demand for Grants. 
-
Each demand initially gives separately the totals of : (a) Voted and Charged 
expenditure; (b) Revenue and Capital Expenditure; (c) Grand total on gross 
basis on the amount of expenditure for which demand is presented.
3.  Finance bill 
-
At the time of presentation of AFS, a finance bill its also presented in fulfilment 
of the requirement of Article 110(1)(a) of the constitution. 
-
It deals with the imposition, abolition, alteration, remission or regulation of 
taxes proposed in the budget. 
-
It also contains other provisions relating to Budget that could be classified as 
Money Bill. 
4.  Statements mandated under FRBM Act 
-
Macroeconomic Framework Statement. 
-
Medium Term Fiscal Policy cum Fiscal Policy Strategy Statement. 
5.   Expenditure Budget 
-
Expenditure of individual ministries/departments are classified under two broad 
umbrellas : (a) Centres’ Expenditures; (b) Transfers to states/UTs. 
-
Centres’ Expenditure : (a) Establishment Expenditure of the centre; (b) Central 
Sector Schemes; (c) Other central expenditure including those on CPSEs and 
Autonomous bodies. 
-
Transfer to States/UTs : (a) Centrally Sponsored Schemes; (b) Finance Commission 
Transfers; (c) Other transfer to states.
Page 5


Budget 2020-21
Arthanomics Series
What will we cover
Key to Budget Documents 
A glance at various receipts and expenditures 
Various deficit statistics  
Budget Profile 
Prominent themes of the budget
Key to Budget Documents
1. Annual Financial Statement(AFS) 
-
The document as provided under Article 112, shows the estimated receipts 
and expenditure of GOI for 2020-21 in relation to estimates for 2019-20 as 
also actual expenditure for the year 2018-19. 
-
These receipts and expenditure are shown under 3 parts: (a) Consolidated 
Fund of India; (b) Contingency Fund of India; (c) Public Account of India. 
-
The AFS has to distinguish the expenditure on revenue account from 
expenditure on other accounts(capital). 
2. Demand for Grants(DG) 
-
Article 113 of the constitution mandates that the estimates of expenditure 
from Consolidated Fund included in AFS and required to be voted by Lok 
Sabha, be submitted in the form of Demand for Grants. 
-
Each demand initially gives separately the totals of : (a) Voted and Charged 
expenditure; (b) Revenue and Capital Expenditure; (c) Grand total on gross 
basis on the amount of expenditure for which demand is presented.
3.  Finance bill 
-
At the time of presentation of AFS, a finance bill its also presented in fulfilment 
of the requirement of Article 110(1)(a) of the constitution. 
-
It deals with the imposition, abolition, alteration, remission or regulation of 
taxes proposed in the budget. 
-
It also contains other provisions relating to Budget that could be classified as 
Money Bill. 
4.  Statements mandated under FRBM Act 
-
Macroeconomic Framework Statement. 
-
Medium Term Fiscal Policy cum Fiscal Policy Strategy Statement. 
5.   Expenditure Budget 
-
Expenditure of individual ministries/departments are classified under two broad 
umbrellas : (a) Centres’ Expenditures; (b) Transfers to states/UTs. 
-
Centres’ Expenditure : (a) Establishment Expenditure of the centre; (b) Central 
Sector Schemes; (c) Other central expenditure including those on CPSEs and 
Autonomous bodies. 
-
Transfer to States/UTs : (a) Centrally Sponsored Schemes; (b) Finance Commission 
Transfers; (c) Other transfer to states.
6.  Receipt Budget 
-
This document provides details of tax and non-tax revenue receipts and capital receipts 
and explains the estimates. 
-
Trend of receipts and expenditure along with deficit indicators, statement pertaining to 
National Small Savings Fund(NSSF), statement of liabilities, statement of guarantees given 
by the government, statements of assets and details of external assistance. 
-
Statement of Revenue Impact of Tax Incentives(earlier known as statement of revenue 
foregone). 
7.   Expenditure Profile 
-
It gives an aggregation of various types of expenditure. 
-
For example it shows the scheme expenditure, expenditure on PSEs, expenditure on 
commercial departments, expenditure on Defence, gender budgeting, schemes for SCs/STs/
Tribals etc. 
8.   Budget at Glance  
9.   Memorandum Explaining the Provisions in Finance Bill 
10.  Output Outcome Monitoring Framework 
-
OOMF for Central Sector Schemes(CSs) & Centrally Sponsored Schemes(CSSs) with financial 
outlay of Rs 500 crore or more, will be laid in the house with the budget 2020-21. 
11.  Key features of Budget 2020-21
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FAQs on PPT: Budget - Indian Economy for UPSC CSE

1. What is a budget?
Ans. A budget is a financial plan that outlines the expected income and expenses for a specific period. It helps individuals or organizations manage their money effectively and make informed decisions about spending and saving.
2. How can I create a budget?
Ans. To create a budget, start by tracking your income and expenses. List all your sources of income and categorize your expenses into different categories such as rent, utilities, groceries, transportation, etc. Then, compare your income with your expenses and allocate a specific amount to each category. Regularly review and adjust your budget as needed.
3. What are the benefits of budgeting?
Ans. Budgeting offers several benefits, such as helping you track your spending, prioritize your expenses, and save money. It allows you to identify areas where you can cut back, reduce debt, and achieve your financial goals. Budgeting also provides a sense of control and helps you make informed decisions about your finances.
4. How can I stick to my budget?
Ans. Sticking to a budget requires discipline and commitment. Here are a few tips to help you stay on track: 1) Regularly review your budget and make adjustments if necessary. 2) Track your expenses and compare them with your budgeted amounts. 3) Avoid impulsive purchases and prioritize your needs over wants. 4) Look for ways to save money, such as using coupons or shopping during sales. 5) Stay motivated by setting short-term and long-term financial goals.
5. What should I do if I exceed my budget?
Ans. If you exceed your budget, it's important to reassess your spending habits and make adjustments. Start by identifying the areas where you overspent and find ways to reduce expenses in those categories. Consider cutting back on non-essential items, finding cheaper alternatives, or increasing your income. It's also helpful to review your budget regularly and make necessary adjustments to prevent future overspending. Remember, budgeting is a learning process, and it's okay to make mistakes as long as you learn from them and make the necessary changes.
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