Finance in India 2024

Finance in India 2024

Gender and Child Budgeting

Indian Econom IBE 2023-24, a total budget provision of 8804421 crore has been provided for 100% women-specific programmes and 1.35.175.54 стогe for schemes where at least 30% allocation is made for women-specific programmes,

A statement "Provision for schemes for the Welfare of Children" has been included from the financial year provisions for Child protection, etc. The allocation 2009-10. It indicates provision for educational outlays, for BE 2023-24 under 'Welfare of Children' is about ₹1.03.790.70 crore.

Office's Role in Financial Services

Department of Posts and Small Savings Schemes

• Department of Posts is operating Small Savings Schemes, modifies rules relating to these schemes and pays on behalf of the Ministry of Finance, which frames and remuneration to the Department of Posts.

• Post Office Savings Bank (POSB) has a customer base. Savings bank facility is provided through a network of 1.57 lakh post offices across the country.

• Accounts, Recurring Deposit (RD), Time Deposits (TD), The Post Office Savings Bank operates Savings Accounts, Monthly Income Schemes (MIS), Public Provident Fund (PPF), National Savings Certificate (NSC), Kisan Vikas Patra (KVP), Senior Citizens Savings Schemes (SCSS), and Sukanya Samriddhi Account.

Mutual Funds and International Money Transfer

• Presently, the Mutual Fund products of UTI are only being retailed through over 2000 post offices. An international money transfer service is a quick and easy way of transferring personal remittances from abroad to beneficiaries in India.

• As a result of the collaboration of the DoP, Government of India, with Western Union Financial Services, a state-of-the-art international money transfer service is available through the post offices.

Core Banking Solution (CBS)

• The Core Banking Solution (CBS) is part of the India Post IT Modernisation project that aims to bring in various IT solutions with the required infrastructure to the post offices.

• The project aims to implement the Core Banking Solution in all departmental Post Offices for Small Savings Schemes.

Jan Suraksha Schemes through Post Offices

Jan Suraksha schemes like the Pradhan Mantri Suraksha Bima Yojana (PMSBY) and Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) were launched in 2015 in all the CBS post offices for all post office savings account holders. Atal Pension Yojana (APY) was also launched in 2015. Sukanya Samriddhi Account, a new Small Savings Scheme for the welfare of the girl child, was launched in 2015.

India Post Payments Bank

• India Post Payments Bank (IPPB) was set up in 2016 with a mandate to build the most accessible, affordable, and trusted bank for the common man by removing the barriers for the unbanked and promoting the adoption of cashless transactions in a predominantly cash-based economy.

• IPPB has rolled out all 650 branches and 1.36 lakh access points. Thus, IPPB has become the biggest bank of the country in terms of physical presence of 1.36 lakh access points along with a large force of 3 lakh trained and certified postmen and Gramin Dak Sevaks (GDS) to offer banking at the doorstep.

Postal Life Insurance

Postal Life Insurance (PLI) was introduced on February 1, 1884, as a welfare scheme for the benefit of postal employees and later extended to the employees of the telegraph department in 1888.

It now covers employees of central and state governments, central and state public sector undertakings, universities, government-aided educational institutions, nationalised banks, and local bodies. PLI also extends the facility of insurance to defence services and para-military forces.

There were more than 49 lakh active policyholders by March 2023, with a sum of 2.56 lakh crore assured. Premium income of Postal Life Insurance for the year 2022-23 was 10,253.26 crore.

Rural Postal Life Insurance

• Rural Postal Life Insurance (RPLI) was started in 1995. There were more than 55 lakh active policyholders by March 2023, with a sum of 1.73 lakh crore assured.

• Premium income of RPLI for 2022-23 was 3,992.72 crore. [Source INDIA 2024]

Demands for Grants

The estimates of expenditure from the Consolidated Fund included in the Annual Financial Statement and required to be voted by the Lok Sabha are submitted in the form of Demands for Grants in pursuance of Article 113 of the Constitution.

The Demands for Grants are presented to the Lok Sabha along with the Annual Financial Statement.

Finance Bill

• At the time of presentation of the Annual Financial Statement before Parliament, a Finance Bill is also presented in fulfilment of the requirement of Article 110 (1) (a) of the Constitution, detailing the imposition, abolition, remission, alteration, or regulation of taxes proposed in the Budget.

• A Finance Bill is a Money Bill as defined in Article 110 of the Constitution. It is accompanied by a Memorandum explaining the provisions included in it.

Appropriation Bills

• After the Demands for Grants are voted by the Lok Sabha, Parliament's approval to the withdrawal from the Consolidated Fund of the amounts so voted and of the amount required to meet the expenditure charged on the Consolidated Fund is sought through the Appropriation Bill.

• Under Article 114(3) of the Constitution, no amount can be withdrawn from the Consolidated Fund without the enactment of such a law by Parliament.

Sources of Revenue

• In accordance with the Constitution (Eightieth Amendment) Act, 2000, which has been given retrospective effect from April 1, 1996, all taxes in the Union List, except the duties and taxes referred to in Articles 268 and 269, respective surcharge on taxes and duties referred to in Article 271 and any cess levied for specific purpose under any law made by Parliament, shall be levied and collected by the Government of India and shall be distributed between the Union and the States in such manner as may be prescribed by the President on the recommendations of the Finance Commission.

• The main sources of Union Tax revenue are customs duties, union excise duties, service tax, corporate and income taxes. Non-tax revenues largely comprise interest receipts, dividends/ profits, fines, and miscellaneous receipts collected in the exercise of sovereign functions, regulatory charges, and license fees and user charges for publicly provided goods and services.

Public Debt

• Public Debt of India is classified into three categories of Union Government liabilities into internal debt, external debt, and other liabilities.

Internal Debt

Internal Debt for the Government of India largely consists of fixed tenure and fixed rate government papers (dated securities and treasury bills), which are issued through auctions.

These include:

• Market loans (dated securities)

• Treasury bills (91, 182, and 364 days)

• Cash management bills

• Special securities issued to the Reserve Bank of India (RBI)

• Compensation and other bonds

• Non-negotiable and non-interest-bearing rupee securities issued under the Market Stabilization Scheme, with a view to reducing dependency on physical gold and reducing imports.

External Debt

• External debt represents loans received from foreign governments and multilateral institutions.

• The Union government does not borrow directly from international capital markets. Its foreign currency borrowing takes place from multilateral agencies and bilateral sources, and is a part of Official Development Assistance (ODA).

Other Liabilities

The Other Liabilities category, not a part of public debt, includes other interest-bearing obligations of the government, such as:

• Post office savings deposits

• Deposits under small savings schemes

• Loans raised through post office cash certificates

• Provident funds

• Certain other deposits

Role of the Reserve Bank of India

The Reserve Bank of India manages the public debt of the central and state governments and also acts as a banker to them under the provisions of the Reserve Bank of India Act, 1934 (Sections 20 and 21).

The Reserve Bank also undertakes similar functions for the state governments by agreement with the government of the respective state (under Section 21A).