Months before the 2024 Lok Sabha elections, Finance Minister Nirmala Sitharaman announced an interim budget in February to manage the government's immediate financial needs. Following the BJP-led NDA's return to power for a third term, she unveiled the comprehensive Union Budget for the financial year 2024-25 on July 23. While both budgets play a major role in the nation's fiscal framework, their objectives and scope vary.
What is an interim budget?
An interim budget is a provisional financial plan presented by the Union government in an election year. Its primary purpose is to secure Parliament's approval for essential government expenditures during the transition period until the new government assumes office.
An interim budget ensures that the government continues to function without any disruption. It does not include significant policy changes or long-term reforms, because the new government might not agree with such decisions.
Unlike a full budget, the interim budget is not subjected to detailed scrutiny or debate in Parliament. It is primarily aimed at obtaining a vote-on-account to cover essential expenses during the interim period.
This limited financial framework is designed to maintain stability while the country transitions to a new government.
The interim budget usually outlines the current state of the economy, fiscal performance, and expected government receipts and expenditures. It is a stop-gap arrangement and does not introduce any new schemes or tax reforms.
What is a full Budget?
The full Union Budget or the annual budget is a detailed financial document presented by the government. It provides a financial statement for the fiscal year, outlining revenue sources, expenditure plans, and policy priorities.
Unlike an interim budget, the full budget undergoes a thorough debate and examination in both Lok Sabha and Rajya Sabha. The process allows members of Parliament to scrutinize various aspects of the budget and suggest amendments before approval.
The full budget includes significant announcements, such as new tax proposals, welfare schemes, and allocations for different ministries. In 2024, Nirmala Sitharaman presented the full Union Budget on July 23 after being sworn in as finance minister.
This annual financial statement reflects the government's priorities for the year ahead, including economic reforms and developmental policies. It provides a clear roadmap for the government's spending and revenue collection plans.
An interim budget is a short-term financial arrangement aimed at covering government expenses during an election period while the full budget outlines a government's financial strategy for the entire year.
