Govt to kick off FY26 Budget making exercise from second week of next month

New Delhi: The finance ministry will commence the exercise to prepare the annual budget for 2025-26 from the second week of next month in the backdrop of the Indian economy recording 7 per cent growth rate for the fourth consecutive year.

The budget for the next financial year would focus on reforms to be pushed to further accelerate growth momentum and measures to generate jobs and boost demand in the economy.

"Pre-budget meetings chaired by Secretary (Expenditure) shall commence in the second week of October 2024. Financial Advisers shall ensure that necessary details...are properly entered in UBIS (Union Budget Information System) before/latest by October 7, 2024," Budget circular 2025-26 issued by the Department of Economic Affairs said.

Hard copies of the data in the specified formats should be submitted for cross-verification, it said.

It will be the second budget of the Modi 3.0 government and 8th straight Budget for Finance Minister Nirmala Sitharaman, a rare distinction in Indian polity.

"All the ministries/departments should submit details of autonomous bodies/ implementing agencies, for which a dedicated corpus fund has been created.

The reasons for their continuance and requirement of grant-in-aid support, and why the same should not be wound up, should be explained," it said.

The Budget Estimates for 2025-26 will be provisionally finalised after completion of pre-budget meetings, it said.

Pre-budget meeting shall commence from second week of October, 2024 and shall continue till around mid-November, 2024, it said.

During the pre-Budget meetings requirement of funds for all categories of expenditures along with receipts of ministries/departments and expenditure estimates on net basis are discussed.

Besides, receipts of departmentally-run commercial undertakings, which are netted against the gross expenditure and non-tax revenues, including arrears of non-tax revenue are also assessed during the meetings.

The Budget 2025-26 is likely to be presented on February 1 during the first half of the Parliament's Budget session which usually begins in the last week of January every year.

The Budget for the current fiscal had projected a nominal GDP growth of 10.5 per cent while fiscal deficit was pegged at 4.9 per cent of the gross domestic product (GDP).

The Prime Minister Narendra Modi-led government in 2017 scrapped a colonial-era tradition of presenting the Budget at the end of February. The erstwhile finance minister Arun Jaitley had for the first time presented the annual accounts on February 1, 2017.

With the preponement of the Budget, ministries are now allocated their budgeted funds from the start of the financial year beginning April. This gives government departments more leeway to spend as well as allow companies time to adapt to business and taxation plans.