The Budget division of the Economic Affairs Department has issued a circular stating that pre-Budget meetings will begin on October 16, 2020. This will be the third budget for Nirmala Sitharaman and also will be the one that will witness or gauge an impact of the unprecedented COVID-19 pandemic.
As per the circular, “The Budget Estimates for 2021-22 will be provisionally finalized after the Secretary (Expenditure) completes discussions with the Secretaries and Financial Advisers. Pre-Budget Meetings shall begin from 16th October, 2020 and shall continue till the first week of November, 2020.”
As per the norm, the ceilings for all categories of expenditure, including Central Sector and Centrally-sponsored schemes will be discussed. “Accordingly, the RE 2020-21 and BE 2021-22 for all categories of expenditure, and select schemes/projects, maybe indicated separately for Revenue and Capital expenditure,” the circular stated.
The government is more likely to struggle with a fiscal deficit that was created due to the COVID-19 pandemic. The early estimates for the fiscal deficit were in the range of 7-8 per cent. But according to Care Ratings, this is set to double. “Based on various scenarios. we believe the combined fiscal deficit could be in the region of 13-13.4 per cent for the year. This is more than double of what was projected before COVID-19 struck India,” stated Care Ratings.
For the first three months of fiscal 2020-21, the Centre’s fiscal deficit was Rs 6.62 lakh crore, which is 83 per cent of the budgeted target for the year.
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