
## Budget Highlights

- 
Expenditure: The government proposes to spend Rs 45,03,097 crore in 2023-24, which is an increase of 7.5% over the 
revised estimate of 2022-23.  In 2022-23, total expenditure is estimated to be 6.1% higher than the budget estimate. 
- 
Receipts: The receipts (other than borrowings) in 2023-24 are expected to be to Rs 27,16,281 crore, an increase of 
11.7% over revised estimate of 2022-23.  In 2022-23, total receipts (other than borrowings) are estimated to be 6.5% higher than the budget estimates. 
- 
GDP: The government has estimated a nominal GDP growth rate of 10.5% in 2023-24 (i.e., real growth plus inflation). 
- 
Deficits: Revenue deficit in 2023-24 is targeted at 2.9% of GDP, which is lower than the revised estimate of 4.1% in 
2022-23.  Fiscal deficit in 2023-24 is targeted at 5.9% of GDP, lower than the revised estimate of 6.4% of GDP in 2022- 23.  While the revised estimate as a percentage of GDP was the same as the budget estimate, in nominal terms, fiscal deficit was higher by Rs 94,123 crore (increase of 5.7%) in 2022-23.  Interest expenditure at Rs 10,79,971 crore is estimated to be 41% of revenue receipts. 
- 
Ministry allocations: Among the top 13 ministries with the highest allocations, in 2023-24, the highest percentage 
increase in allocation is observed in the Ministry of Railways (49%), followed by the Ministry of Jal Shakti (31%), and the Ministry of Road Transport and Highways (25%). 

## Main Tax Proposals In The Finance Bill

|          | Table 1: Current and proposed tax slabs   |                         |
|----------|-------------------------------------------|-------------------------|
| Tax Rate | Current Income Slab                       | Proposed Income Slab    |
| Nil      | Up to Rs 2.5 lakh                         | Up to Rs 3 lakh         |
| 5%       | Rs 2.5 lakh to Rs 5 lakh                  | Rs 3 lakh to Rs 6 lakh  |
| 10%      | Rs 5 lakh to Rs 7.5 lakh                  | Rs 6 lakh to Rs 9 lakh  |
| 15%      | Rs 7.5 lakh to Rs 10 lakh                 | Rs 9 lakh to Rs 12 lakh |
| 20%      | Rs 10 lakh to Rs 12                       | .5                      |
| 25%      | Rs 12                                     | .5                      |
| 30%      | Above Rs 15 lakh                          | Above Rs 15 lakh        |
|          |                                           |                         |

- 
Changes in the new income tax regime: The number 
of tax slabs has been reduced from six to five.  Table 1 compares the current tax income structure with the proposed income tax structure.  The surcharge on the income when it exceeds Rs 5 crore will be reduced from
 37% to 25%.  Currently, those with income up to Rs 5 
lakh can avail a rebate and not pay any taxes; this limit 
has been raised to Rs 7 lakh.  Further, the standard 
deduction will be available under the new tax regime. 
- 
Changes in tax exemptions: The tax exemption for news agencies set up solely for the collection and distribution of 
news will be removed.   
- 
Charitable trusts are required to apply 85% of their income within the year to avail income tax exemption.  From April 2023, if a charitable trust donates to another charitable trust, only 85% of such a donation would be considered as application of income.  
- 
Presumptive taxation: The upper limit on turnover for MSMEs to be eligible for presumptive taxation has been raised 
from Rs 2 crore to Rs 3 crore.  The upper limit on gross receipts for professionals eligible for presumptive taxation has been raised from Rs 50 lakh to Rs 75 lakh. 
- 
Co-operative societies: The income tax rate for new co-operative societies engaged in manufacturing activities has been 
lowered from 22% to 15% (plus 10% surcharge). 
- 
Capital gains: Capital gains from sale of residential property can be deducted to the extent of purchase or construction of 
another residential property.  The deduction will be capped at Rs 10 crore. 
- 
Life insurance: Income from investments in life insurance policies will be taxable if premium of Rs 5 lakh has been paid 
in any year.  The amount paid upon the death of the policy holder will continue to be exempt from income tax.   
- 
Online Games: Winnings from online games will be subject to 30% tax deductible at source. 
- 
Startups: Startups incorporated within a time-period and meeting other conditions can deduct up to 100% of their profits; 
the end of this period has been extended from March 31, 2023 to March 31, 2024.  In addition, the period within which losses of startups may be carried forward has been extended from seven to ten years. 
- 
Indirect Taxes: Customs duty on several items have been changed.  On a few items such as gold, platinum, and aeroplanes the amount of cess has been increased with a corresponding decrease in customs duties. 
- 
CGST: The CGST Act will be amended such that input tax credit will not be available for goods and services purchased 
for use in activities related to corporate social responsibility. 

## Policy Highlights

- 
Legislative proposals: Amendments will be made to the Banking Regulation Act, 1949, Banking Companies 
(Acquisition and Transfer of Undertaking) Act, 1970, and the Reserve Bank of India Act, 1934 to improve bank governance and enhance investors' confidence.  Several measures will be taken to improve business activities in the Gujarat International Finance Tech-City International Financial Services Centre (GIFT IFSC).  For instance, the IFSC 
Authority Act, 2019 will be amended to provide for arbitration and ancillary services in GIFT IFSC, and avoiding dual 
regulation under the Special Economic Zones Act, 2005.   
- 
Infrastructure: The scheme providing 50-year interest free loans to state governments will be made available in 2023-
24 also with an outlay of Rs 1.3 lakh crore.  100 critical transport infrastructure projects for last and first mile connectivity for various sectors such as ports, coal, steel will be taken up.  This will have an investment of Rs 75,000 crore including Rs 15,000 crore from private sources.    
- 
Urban Development: An Urban Infrastructure Development Fund will be established for development of urban 
infrastructure by public agencies in tier-2 and tier-3 cities.  The Fund will be managed by the National Housing Bank and is expected to have an annual allocation of Rs 10,000 crore.  States and cities will be encouraged to undertake urban planning reforms such as efficient land use and transit-oriented development.  Cities will be incentivised to improve their credit worthiness for municipal bonds through property tax reforms and setting aside user charges.     
- 
Agriculture: An Agriculture Accelerator Fund will be set up to encourage agri-startups in rural areas.  A sub-scheme of 
PM Matsya Sampada Yojana will be launched with an investment of Rs 6,000 crore to support fishermen, fish vendors, and MSMEs.  Decentralised storage capacity will be set up for farmers to store their produce.  PM Programme for Restoration, Awareness, Nourishment and Amelioration of Mother Earth (PM-PRANAM) will be launched to 
incentivise states/UTs to promote balanced use of chemical fertilisers and alternative fertilisers.      
- 
Energy and Environment: A Green Credit Programme will be notified under the Environment (Protection) Act, 1986 
to incentivise environmentally sustainable actions by companies, individuals, and local bodies, and help gather additional resources for such actions.  Battery Energy Storage Systems with 4,000 MWh capacity will be supported with 
viability gap funding.   
- 
Research and Development (R&D): Three centres of excellence for R&D in Artificial Intelligence will be established 
in select educational institutions.  100 labs will be set up in engineering institutions for developing applications using 5G services.  A National Data Governance Policy will be released to enable access to anonymised data.  A programme to 
promote research and innovation in pharmaceuticals will be taken up through centres of excellence.    
- 
Health: Nursing colleges will be started along with all existing 157 medical colleges.  In order to eliminate sickle cell 
anaemia by 2047, a Mission will be launched covering seven crore people in the age group 0-40 in affected tribal areas.  
- 
Finance: A National Finance Information registry will be set up for accessing all financial and ancillary information.  A 
small savings scheme, Mahila Samman Savings Certificate will be launched for two years.  Further, the deposit limit for 
senior citizens savings scheme will be increased from Rs 15 lakh to Rs 30 lakh.     
- 
Governance: The KYC process will be simplified and financial sector regulators will be encouraged to have a KYC 
system.  A Unified Filing Process will be set up for submitting information to different government agencies.  A Voluntary Settlement Scheme will be launched to settle contractual disputes of government and its undertakings.  The financing system of certain schemes will be changed from input-based to result-based on a pilot basis.     

## Budget Estimates Of 2023-24 As Compared To Revised Estimates Of 2022-23

- 
Total Expenditure: The government is estimated to spend Rs 45,03,097 crore in 2023-24.  This is an increase of 7.5% 
over the revised estimate of 2022-23.  Out of the total expenditure, revenue expenditure is estimated to be Rs 35,02,136 crore (1.2% increase) and capital expenditure is estimated to be Rs 10,00,961 crore (37.4% increase).  The increase in 
capital expenditure is due to an increase in capital outlay on transport (including railways, roads and bridges, and inland 
water transport) by Rs 1,28,863 crore (36.1% increase).  Expenditure on total capital outlay is estimated to be Rs 8,37,127 crore in 2023-24, an increase of 35% over the revised estimates for 2022-23. 
- 
Total Receipts: Government receipts (excluding borrowings) are estimated to be Rs 27,16,281 crore, an increase of 11.7% 
over the revised estimates of 2022-23.  The gap between these receipts and the expenditure will be plugged by borrowings, budgeted to be Rs 17,86,816 crore, an increase of 1.8% over the revised estimate of 2022-23. 
- 
Transfer to states: The central government will transfer Rs 18,62,874 crore to states and union territories in 2023-24, an 
increase of 8.9% over the revised estimates of 2022-23.  Transfer to states includes devolution of Rs 10,21,448 crore out of the divisible pool of central taxes, grants worth Rs 6,86,773 crore, and special loans worth Rs 1.3 lakh crore for capital expenditure.   
- 
Deficits: Revenue deficit is targeted at 2.9% of GDP, and fiscal deficit is targeted at 5.9% of GDP in 2023-24.  The target 
for primary deficit (which is fiscal deficit excluding interest payments) in 2023-24 is 2.3% of GDP.  The revised estimate for the revenue deficit target has increased from the budgeted estimate in 2022-23.  The revised fiscal deficit target for 2022-23 has remained the same, despite higher receipts.  In 2022-23, the central government's revenue deficit is expected to be 4.1% of GDP against a budget estimate of 3.8% of GDP.  
- 
GDP growth estimate: The nominal GDP is estimated to grow at a rate of 10.5% in 2023-24. 

## Table 2: Budget At A Glance 2023-24 (Rs Crore)

  
Actuals 
2021-22 
Budgeted 
2022-23 
Revenue Expenditure 
32,00,926 
31,94,663 
34,58,959 
35,02,136 
1.2% 
Capital Expenditure 
5,92,874 
7,50,246 
7,28,274 
10,00,961 
37.4% 
of which: 


Capital Outlay 
5,34,499 
6,10,189 
6,20,204 
8,37,127 
35.0% 
Loans and Advances 
58,376 
1,40,057 
1,08,070 
1,63,834 
51.6% 
Total Expenditure 
37,93,801 
39,44,909 
41,87,232 
45,03,097 
7.5% 
Revenue Receipts 
21,69,905 
22,04,422 
23,48,413 
26,32,281 
12.1% 
Capital Receipts 
39,375 
79,291 
83,500 
84,000 
0.6% 
of which: 

  Recoveries of Loans 
24,737 
14,291 
23,500 
23,000 
-2.1% 
   Other receipts (including disinvestments) 
14,638 
65,000 
60,000 
61,000 
 
Total Receipts (excluding borrowings) 
22,09,280 
22,83,713 
24,31,913 
27,16,281 
11.7% 
Revenue Deficit 
10,31,021 
9,90,241 
11,10,546 
8,69,855 
-21.7% 
% of GDP 
4.4% 
3.8% 
4.1% 
2.9% 
-29.3% 
Fiscal Deficit 
15,84,521 
16,61,196 
17,55,319 
17,86,816 
1.8% 
% of GDP 
6.7% 
6.4% 
6.4% 
5.9% 
-7.8% 
Primary Deficit 
7,79,022 
7,20,545 
8,14,668 
7,06,845 
-13.2% 
% of GDP 
3.3% 
2.8% 
3.0% 
2.3% 
-23.3% 

Sources: Budget at a Glance, Union Budget Documents 2023-24; PRS. 

Expenses which bring a change to the government's assets or liabilities 
(such as construction of roads or recovery of loans) are capital expenses, and all other expenses are revenue expenses (such as payment of salaries or interest payments).  In 2023-24, **capital expenditure** is expected to increase by 37.4% over the revised estimates of 2022-23, to Rs 
10,00,961 crore.  **Revenue expenditure** is expected to increase by 1.2% over the revised estimates of 2022-23 to Rs 35,02,136 crore. 

Disinvestment is the government selling its stakes in Public Sector 
Undertakings (PSUs).  In 2022-23, the government is estimated to meet 
77% of its disinvestment target (Rs 50,000 crore against a target of Rs 
65,000 crore).  The disinvestment target for 2023-24 is Rs 51,000 crore. 
                                                                                                                 

 

Revised 
2022-23 
Budgeted 
2023-24 
% change (2022-23 
RE to 2023-24 BE) 

Note: Actual data for 2022-23 is revised estimate. 

Sources: Union Budget Documents (various years); PRS. 

## Receipts Highlights For 2023-24

- 
Receipts (excluding borrowings) in 2023-24 are estimated to be Rs 27,16,281 crore, an increase of 11.7% over the revised 
estimates of 2022-23. 
- 
Gross tax revenue is budgeted to increase by 10.4% over the revised estimates of 2022-23, which is about the same as the 
estimated nominal GDP growth of 10.5% in 2023-24.  Corporation tax and income tax are estimated to increase at the same rate as the nominal GDP (10.5%).  Excise duties (mainly imposed on petroleum products) are expected to rise by 5.9% in 2023-24.  GST revenue is budgeted to increase at a higher rate (12%).  The net tax revenue of the central government (excluding states' share in taxes) is estimated to be Rs 23,30,631 crore in 2023-24, which is 11.7% over the revised estimates for 2022-23. 
- 
Devolution to states from centre's tax revenue is estimated to be Rs 10,21,448 crore in 2023-24, an increase of 7.7% over the revised estimates of 2022-23.  In 2022-23, the devolution to states increased by Rs 1,31,756 crore, from an estimate of Rs 8,16,649 crore at the budgeted stage to Rs 9,48,405 crore at the revised stage (16%).   
- 
Non-tax revenue is estimated at Rs 3,01,650 crore in 2023-24, an increase of 15.2%  over the revised estimate of 2022-23. 
- 
Capital receipts (excluding borrowings) are targeted at Rs 84,000 crore, a marginal increase of 0.6% over the revised 
estimates of 2022-23.  Recoveries of loans and advances were 64% higher in the revised estimates of 2022-23 at Rs 23,500 crore compared to budget estimates of Rs 14,291 crore.   

% change 2022-23 RE 
 
Actuals 
2021-22 
Budgeted 
2022-23 
Revised 
2022-23 
Budgeted 
2023-24 
to 2023-24 BE 
Gross Tax Revenue 
27,09,135 
27,57,820 
30,43,067 
33,60,858 
10.4% 
of which: 


Corporation Tax 
7,12,037 
7,20,000 
8,35,000 
9,22,675 
10.5% 
Taxes on Income 
6,96,243 
7,00,000 
8,15,000 
9,00,575 
10.5% 
Goods and Services Tax 
6,98,114 
7,80,000 
8,54,000 
9,56,600 
12.0% 
Customs 
1,99,728 
2,13,000 
2,10,000 
2,33,100 
11.0% 
Union Excise Duties 
3,94,644 
3,35,000 
3,20,000 
3,39,000 
5.9% 
Service Tax 
1,012 
2,000 
1,000 
500 
-50.0% 
A. Centre's Net Tax Revenue 
18,04,794 
19,34,771 
20,86,662 
23,30,631 
11.7% 
Devolution to States 
8,98,392 
8,16,649 
9,48,405 
10,21,448 
7.7% 
B. Non Tax Revenue 
3,65,112 
2,69,651 
2,61,751 
3,01,650 
15.2% 
of which: 


Interest Receipts 
21,874 
18,000 
24,640 
24,820 
0.7% 
Dividend 
1,60,647 
1,13,948 
83,953 
91,000 
8.4% 
Other Non-Tax Revenue 
1,79,540 
1,34,276 
1,48,342 
1,81,382 
22.3% 
C. Capital Receipts (without borrowings) 
39,375 
79,291 
83,500 
84,000 
0.6% 
of which: 


Disinvestment 
13,627 
65,000 
50,000 
51,000 
2.0% 
Receipts (without borrowings) (A+B+C) 
22,09,281 
22,83,713 
24,31,913 
27,16,281 
11.7% 
Borrowings 
15,84,521 
16,61,196 
17,55,319 
17,86,816 
1.8% 
Total Receipts (including borrowings) 
37,93,802 
39,44,909 
41,87,232 
45,03,097 
7.5% 

Sources: Receipts Budget, Union Budget Documents 2023-24; PRS. 

- 
Indirect taxes: The total indirect tax collections are estimated to be Rs 15,29,200 crore in 2023-24.  Of this, the 
government has estimated to raise Rs 9,56,600 crore from GST.  Out of the total tax collections under GST, 85% is expected to come from central GST (Rs 8,11,600 crore), and 15% from the GST compensation cess (Rs 1,45,000 crore).     
- 
Corporation tax: The collections from taxes on companies are expected to increase by 10.5% in 2023-24.  In 2022-23, 
corporate tax collection is expected to be 16% higher than the budget estimate (Rs 7,20,000 crore). 
- 
Income tax: The collections from income tax are also expected to increase by 10.5% in 2023-24 to Rs 9,00,575 crore.  
Income tax collection is expected to be 16.4% higher than the budget estimate in 2022-23. 
- 
Non-tax receipts: Non-tax revenue consists mainly of interest receipts on loans given by the centre, dividends, license fees, 
tolls, and charges for government services.  Dividend receipts were lower in 2022-23 than originally budgeted mainly on account of lower dividend from Reserve Bank of India.  In 2023-24, non-tax revenue is expected to increase by 15% over the revised estimates of 2022-23.   
- 
Disinvestment target: The disinvestment target for 2023-24 is Rs 51,000 crore.  This is a marginal increase of 2% over 
the revised estimate of 2022-23 (Rs 50,000 crore).  In 2022-23, the receipts from disinvestment are expected to be 23% lower than the budget estimate. 

## Expenditure Highlights For 2023-24

 
Total expenditure in 2023-24 is expected to be Rs 45,03,097 crore, which is an increase of 7.5% over than the revised 
estimate of 2022-23.  Out of this: (i) Rs 14,67,880 crore is proposed to be spent on central sector schemes (4% increase over the revised estimate of 2022-23), and (ii) Rs 4,76,105 crore is proposed to be spent on centrally sponsored 
schemes (a 5.4% increase over the revised estimate of 2022-23). 
 
The government has estimated to spend Rs 2,34,359 crore on pension in 2023-24, which is 4.3% lower than the revised estimate of 2022-23.  In addition, expenditure on interest payment in 2023-24 is estimated to be Rs 10,79,971 crore, which is 24% of the government's expenditure.  In 2023-24, interest payments are expected to increase by 14.8% as compared to revised estimates of 2022-23.   

  
Actuals 
2021-22 
Budgeted 
2022-23 
Revised 
2022-23 
Budgeted 
2023-24 
% change (2022-23 
RE to 2023-24 BE) 
Central Expenditure 
29,13,970 
30,06,111 
32,82,936 
35,13,761 
7.0% 
Establishment Expenditure of Centre 
6,93,272 
6,92,214 
7,34,619 
7,44,339 
1.3% 
Central Sector Schemes 
12,09,950 
11,81,084 
14,11,729 
14,67,880 
4.0% 
Other expenditure 
10,10,748 
11,32,813 
11,36,588 
13,01,542 
14.5% 
Grants for CSS and other transfers 
8,79,832 
9,38,797 
9,04,296 
9,89,337 
9.4% 
Centrally Sponsored Schemes (CSS) 
4,54,366 
4,42,781 
4,51,901 
4,76,105 
5.4% 
Finance Commission Grants 
2,07,435 
1,92,108 
1,73,257 
1,65,480 
-4.5% 
of which: 


Rural Local Bodies 
40,312 
46,513 
41,000 
47,018 
14.7% 
Urban Local Bodies 
16,147 
22,908 
15,026 
24,222 
61.2% 
Grants-in-aid 
20,272 
23,294 
22,135 
24,466 
10.5% 
Post Devolution Revenue Deficit Grants 
1,18,452 
86,201 
86,201 
51,673 
-40.1% 
Other grants 
2,18,031 
3,03,908 
2,79,138 
3,47,752 
24.6% 
Total Expenditure 
37,93,801 
39,44,909 
41,87,232 
45,03,097 
7.5% 

Sources:  Budget at a Glance, Union Budget Documents 2023-24; PRS. 

Expenditure by Ministries  
In 2023-24, the ministries with the highest allocations account for 55% of the estimated total expenditure.  Of these, the Ministry of Defence has the highest allocation in 2023-24, at Rs 5,93,538 crore.  It accounts for 13.2% of the total budgeted expenditure of the central government.  Other ministries with high allocation include: (i) Road Transport and Highways (6% of total expenditure), (ii) Railways (5.4%), and (iii) Consumer Affairs, Food, and Public Distribution (4.6%).  Table 5 shows the expenditure on Ministries with the 13 highest allocations for 2023-24 and the changes in allocation as compared to the revised estimate of 2022-23. 

% change 
  
Actuals 
2021-22 
Budgeted 
2022-23 
Revised 
2022-23 
Budgeted 
2023-24 
(2022-23 RE to 2023-24 BE) 
Defence 
5,00,681 
5,25,166 
5,84,791 
5,93,538 
1.5% 
Road Transport and Highways 
1,23,551 
1,99,108 
2,17,027 
2,70,435 
24.6% 
Railways 
1,35,242 
1,40,367 
1,62,312 
2,41,268 
48.6% 
Food and Public Distribution 
3,06,571 
2,17,684 
2,96,523 
2,05,765 
-30.6% 
Home Affairs 
1,68,791 
1,85,777 
1,93,912 
1,96,035 
1.1% 
Chemicals and Fertilisers 
1,54,789 
1,07,715 
2,27,681 
1,78,482 
-21.6% 
Rural Development 
1,61,643 
1,38,204 
1,82,382 
1,59,964 
-12.3% 
Agriculture and Farmers' Welfare 
1,22,836 
1,32,514 
1,18,913 
1,25,036 
5.1% 
Communications 
51,545 
1,05,407 
1,05,478 
1,23,393 
17.0% 
Education 
80,352 
1,04,278 
99,881 
1,12,899 
13.0% 
Jal Shakti 
83,467 
86,189 
74,029 
97,278 
31.4% 
Health and Family Welfare 
84,470 
86,201 
79,145 
89,155 
12.6% 
Housing and Urban Affairs 
1,06,840 
76,549 
74,546 
76,432 
2.5% 
Other Ministries 
17,13,022 
18,39,751 
17,70,613 
20,33,419 
14.8% 
Total Expenditure 
37,93,801 
39,44,909 
41,87,232 
45,03,097 
7.5% 

Sources:  Expenditure Budget, Union Budget 2023-24; PRS. 

 
Railways: Allocation is estimated to increase by Rs 78,956 crore (48.6%) in 2023-24, over the revised estimate of 2022-
23.  This is mainly on account of increased capital outlay on commercial lines. 
- 
Jal Shakti: Allocation to the Ministry of Jal Shakti is estimated to increase by Rs 23,249 crore (31.4%) in 2023-24, 
driven by an increase in the allocation for Jal Jeevan Mission. 
- 
Road Transport and Highways: Allocation in 2023-24 is estimated to increase by Rs 53,408 crore (24.6%), on account 
of an increase on capital outlay on roads and bridges (24.5%).   
- 
Allocation towards the Ministries of Consumer Affairs, Food and Public Distribution, and Chemicals and Fertilisers have 
decreased mainly on account of a reduction in food subsidy and fertiliser subsidy.  We discuss the expenditure on subsidies below. 

## Expenditure On Subsidies

In 2023-24, the total expenditure on subsidies is estimated to be Rs 4,03,084 crore, a decrease of 28.3% from the revised estimate of 2022-23 (Table 6). 

- 
Food subsidy: Allocation to food subsidy is estimated at Rs 1,97,350 crore in 2023-24, a 31.3% decrease over the revised 
estimate of 2022-23.  A higher level of food subsidy was budgeted in 2021-22 and 2022-23 mainly on account of Pradhan Mantri Garib Kalyan Ann Yojana, which provides for free additional foodgrains to eligible beneficiaries to mitigate the impact of COVID-19.  The provision of additional foodgrains was discontinued in December 2022. 
- 
Fertiliser subsidy: Expenditure on fertiliser subsidy is estimated at Rs 1,75,100 crore in 2023-24.  This is a decrease of 
Rs 50,120 crore (22.3%) from the revised estimate of 2022-23.  Fertiliser subsidy for 2022-23 was increased substantially in response to a sharp increase in international prices of raw materials used in the manufacturing of fertilisers. 
- 
Other subsidies: Expenditure on other subsidies includes interest subsidies for various government schemes, subsidies 
for the price support scheme for agricultural produce, and assistance to ship building research and development, among others.  In 2023-24, the expenditure on these other subsidies is estimated to decrease by 30% over the revised estimate of 2022-23.   

## Table 6: Subsidies In 2023-24 (Rs Crore)

| Budgeted           | Budgeted    | % change                   |
|--------------------|-------------|----------------------------|
|                    |             |                            |
| Actuals            |             |                            |
| 2021-22            | 2022-23     |                            |
| Revised            |             |                            |
| 2022-23            | 2023-24     | (2022-23 RE to 2023-24 BE) |
| Food subsidy       |             |                            |
| 2,88,969           | 2,06,831    | 2,87,194                   |
| Fertiliser subsidy |             |                            |
| 1,53,758           | 1,05,222    | 2,25,220                   |
| Petroleum subsidy  |             |                            |
| 3,423              | 5,813       | 9,171                      |
| Other subsidies    |             |                            |
| 57,758             | 37,773      | 40,495                     |
| Total              |             |                            |
| 5,03,907           | 3,55,639    | 5,62,080                   |

Sources: Expenditure Profile, Union Budget 2023-24; PRS. 

## Expenditure On Major Schemes Table 7: Scheme Wise Allocation In 2023-24 (Rs Crore)

  
Actuals 
2021-22 
Budgeted 
2022-23 
Revised 
2022-23 
Budgeted 
2023-24 
% change (2022-23 
RE to 2023-24 BE) 
Pradhan Mantri Awas Yojana 
90,020 
48,000 
77,130 
79,590 
3.2% 
Jal Jeevan Mission/National Rural Drinking Water Mission 
63,126 
60,000 
55,000 
70,000 
27.3% 
PM-KISAN 
66,825 
68,000 
60,000 
60,000 
0.0% 
MGNREGS 
98,468 
73,000 
89,400 
60,000 
-32.9% 
National Education Mission 
25,305 
39,553 
32,612 
38,953 
19.4% 
National Health Mission 
32,958 
37,160 
33,708 
36,785 
9.1% 
Modified Interest Subvention Scheme* 
- 
19,500 
22,000 
23,000 
4.5% 
Saksham Anganwadi and POSHAN 2.0  
18,382 
20,263 
20,263 
20,554 
1.4% 
Pradhan Mantri Gram Sadak Yojana 
13,992 
19,000 
19,000 
19,000 
0.0% 
AMRUT and Smart Cities Mission 
13,868 
14,100 
15,300 
16,000 
4.6% 
National Livelihood Mission-Ajeevika 
10,177 
14,236 
13,886 
14,129 
1.7% 
Guarantee Emergency Credit Line to MSME borrowers 
7,445 
15,000 
10,500 
14,100 
34.3% 
Pradhan Mantri Fasal Bima Yojana 
13,549 
15,500 
12,376 
13,625 
10.1% 
Swachh Bharat Mission 
5,050 
9,492 
7,000 
12,192 
74.2% 
Reform Linked Distribution Scheme 
814 
7,566 
6,000 
12,072 
101.2% 

Note: The Modified Interest Subvention Scheme replaced the scheme for interest subsidy for short term credit to farmers (the actual expenditure towards this scheme is Rs 21,477 crore in 2021-22). Sources: Expenditure Profile, Union Budget 2023-24; PRS.   
- 
Pradhan Mantri Awas Yojana (rural and urban components taken together) has the highest allocation in 2023-24 at Rs 79,590 crore.  This is an increase of 3.2% over the revised estimate of 2022-23.  As compared to the revised estimates of 2022-23, the allocation for the rural component of the scheme has increased by 13% and the urban component has declined by 13% in 2023-24.  For 2022-23, the allocation towards the scheme has been increased by 60.7% as compared to the budget estimates. 

- 
The Jal Jeevan Mission has the second highest allocation in 2023-24 at Rs 70,000 crore, an increase of 27.3% over the 
revised estimate of Rs 55,000 crore in 2022-23. 
- 
Allocation for PM-KISAN has been kept constant at Rs 60,000 crore, and for MGNREGS has been reduced by 33% to Rs 60,000 crore. 
- 
Some other schemes with a comparatively higher increase in allocation in 2023-24 include: (i) Reform Linked 
Distribution Scheme (101.2%), (ii) Swachh Bharat Mission (74.2%), and (iii) Guarantee Emergency Credit Line to MSME borrowers (34.3%).  

## Loans To States For Capital Expenditure

- 
The Centre has budgeted Rs 1.3 lakh crore for special interest-free loans to states for capital expenditure.  The revised estimates for 2022-23 at Rs 76,000 crore were lower than the budgeted Rs 1 lakh crore.   

## Expenditure On Scheduled Caste And Scheduled Tribe Sub-Plans And Schemes For Welfare Of Women, Children And North Eastern Region

% change 
  
Actuals 
2021-22 
Revised 
2022-23 
Budgeted 
2023-24 
(2022-23 RE to 
2023-24 BE) 
Welfare of Women 
2,09,528 
2,18,487 
2,23,220 
2.2% 
Welfare of Children 
73,199 
89,008 
1,03,791 
16.6% 

- 
Programmes for the welfare of women and children have been allocated Rs 3,27,010 crore in 2023-24, an increase of 6.3% over the revised estimate of 2022- 23.  These allocations include programmes being implemented across all ministries.   

| Scheduled Castes           | 1,21,614    | 1,52,604    | 1,59,126    | 4.3%    |
|----------------------------|-------------|-------------|-------------|---------|
| Scheduled Tribes           | 83,921      | 94,293      | 1,19,510    | 26.7%   |
| North Eastern Region (NER) | -           | 72,540      | 94,680      | 30.5%   |

Sources: Expenditure Profile, Union Budget 2023-24; PRS. 

- 
The allocation towards scheduled castes and scheduled tribes in 2023-24 is estimated to increase by 4.3% and 26.7%, respectively.  The budget for road works under allocation for welfare of scheduled tribes has increased by 265% in 2023-24 as compared to revised estimate of 2022-23.  The allocation towards North Eastern Region is estimated to increase by 30.5% in 2023-24 over the revised estimates of 2022-23. 

## Fiscal Responsibility And Budget Management Targets

The Fiscal Responsibility and Budget Management (FRBM) Act, 2003 requires the central government to progressively reduce its outstanding debt, revenue deficit and fiscal deficit, and give three year rolling targets.  Note that the Medium-Term Fiscal Policy Statement has not provided rolling targets for budget deficits since 2021-22.  In the Budget speech, the finance minister reiterated the government's aim to reduce fiscal deficit to below 4.5% of GDP by 2025-26. 

  
Actuals 
2021-22 
Revised 
2022-23 
Budgeted 
2023-24 

Fiscal deficit is an indicator of borrowings by the government for financing its expenditure.  The estimated fiscal deficit for 2023-24 is 5.9% of GDP. 

| Fiscal Deficit    | 6.7%    | 6.4%    | 5.9%    |
|-------------------|---------|---------|---------|
| Revenue Deficit   | 4.4%    | 4.1%    | 2.9%    |
| Primary Deficit   | 3.3%    | 3.0%    | 2.3%    |

Sources: Medium Term Fiscal Policy Statement, Union Budget 2023-24; PRS. 

Revenue deficit is the excess of revenue expenditure over revenue receipts.  Such a deficit implies that the government needs to borrow funds to meet recurring expenses which may not provide future returns.  The estimated revenue deficit for 2023-24 is 2.9% of GDP. 

Primary deficit is the difference between fiscal deficit and interest payments.  It is estimated to be 2.3% of GDP in 2023-24.  
Note: Data for 2022-23 is revised estimate. Sources: Budget at a Glance, Union Budget (multiple years); PRS. 

- 
In the 2022-23 budget, the government estimated the fiscal deficit to be at 6.4% of GDP, and the revenue deficit to be at 
3.8% of GDP.  As per the revised estimates for 2022-23, the ratio of fiscal deficit to GDP is estimated to be the same as budget estimate despite fiscal deficit being higher in nominal terms by Rs 94,123 crore (5.7% overshooting).  This was due to GDP growth being higher than estimated. 
- 
Outstanding Liabilities: The central government's outstanding liabilities declined from 51% in 2012-13 to 48% in 2018-
19.  From 2019-20 onwards, outstanding liabilities have been increasing, and reached a high of 61% in 2020-21.  They 
declined to 57% in 2021-22, and are expected to remain at that level in 2023-24.    
- 
Outstanding liabilities is the accumulation of borrowings over the years.  A higher debt implies that the government has a higher loan repayment obligation over the years. 
- 
The interest payments as a percentage of revenue receipts increased from 36% in 2011-12 to 42% in 2020-21.  As per the budget estimates, this figure is expected to marginally reduce to 41% in 2023-24. 
Note: RE is revised estimate and BE is budget estimate. Sources: Economic Survey 2022-23, Union Budget Documents 2023-24; PRS. 

 
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