At the start of the first session of the year, the President delivered an inaugural address. This was followed by the presentation of the Union Budget 2023-24. In the remaining two days, both Lok Sabha and Rajya Sabha were scheduled to take up discussion on the Motion of Thanks to the President's Address. However, no business was transacted as both Houses adjourned repeatedly due to disruptions.
Our analysis of the Union Budget discussing key policy announcements, trends in headline budget figures, and allocations to different ministries and schemes is now available. Some of the key numbers include:
The government is estimated to spend Rs 45.03 lakh crore in 2023-24, a 7.5% increase from an expenditure of Rs 41.87 lakh crore in 2022-23.
The revenue expenditure in 2023-24 is estimated at Rs 35.02 lakh crore, making up 78% of total expenditure. The remaining 22% is allocated towards capital expenditure (Rs 10 lakh crore). Capital expenditure has seen an increase of 37.4% while revenue expenditure has seen an increase of 1.2% compared to previous year.
Government receipts (excluding borrowings) are estimated to be Rs 27.16 lakh crore, an increase of 11.7% over 2022-23.
Gross tax revenue is budgeted to increase by 10.4% over 2022-23, which is about the same as the estimated nominal GDP growth of 10.5% in 2023-24. GST revenue is budgeted to increase at a higher rate (12%). Non-tax revenue is estimated to increase by 15.2% over 2022-23.
The gap between these receipts and the expenditure will be plugged by borrowings, budgeted to be Rs 17.87 lakh crore, an increase of 1.8% over 2022-23. However, as a percentage of GDP, Fiscal Deficit is estimated to reduce to 5.9% from 6.4% in 2022-23.
The central government’s transfer to states and UTs is estimated at Rs 18.63 lakh crore in 2023-24, an increase of 8.9% over 2022-23.
The Finance Minister also tabled the Economic Survey for 2022-23. Our summary of the report is available here. We have also published a discussion paper on Finances of the Central Government which looks at trends in tax collection, committed liabilities, debt levels, and more. Some highlights:
In about thirty years since 1990-91, the total tax collection of central and state governments has not seen any significant change. Total tax collection had increased from 15.2% of GDP in 1990-91 to 17.9% of GDP in 2007-08. Since then, it has ranged between 15.5%-17.5% of GDP. Gross tax revenue collected by the central government is estimated to be 11.1% of GDP in 2023-24.
There has been a steep rise in general government debt (centre and states) from about 70% of GDP at the end of 2018-19 to about 85% of GDP at the end of 2022-23. The debt of the central government is estimated to rise from 49% of GDP at the end of 2017-18 to 58% of GDP at the end of 2022-23. High debt levels over the years have required the central government to set aside a significant portion of its revenue receipts towards interest payments, which will constitute 41% of revenue receipts in 2023-24.
Numbers to Note
72,368 million litres per day
The Ministry of Jal Shakti informed Lok Sabha this week that sewage generation across the country is estimated at 72,368 million litres per day (mld). In comparison, the Operational Treatment Capacity stands at 26,869 mld.
The Ministry of Law and Justice informed Rajya Sabha this week that 1,24,810 cases are pending for more than 25 years in the High Courts (as on January 30, 2023). The number of cases pending for more than 25 years in the Supreme Court is 81 and for subordinate courts, this number stands at 2,76,208.