)
Finance Minister Arun Jaitley estimated 2015-16 total expenditure at Rs 17.77 lakh crore, compared to Rs 16.81 lakh crore revised estimates for 2014-15. Non-plan expenditure has been budgeted at Rs 13.12 lakh crore, while plan expenditure is estimated to be Rs 4.65 lakh crore for 2015-16.
For 2015-16 the defence outlay is expected at Rs 2.47 lakh crore, up Rs 24,357 crore from the revised estimates of 2014-15. The 2015-16 major subsidies’ budget estimates stand at Rs 2.27 lakh crore, with food subsidies at Rs 1.24 lakh crore, fertilizer subsidies at Rs 72,968 crore, and oil subsidies at Rs 30,000 crore, which is half the revised estimates of the current year, thus showing clear savings from low crude oil prices. The revised estimates for major subsidies stand at Rs 2.54 lakh crore in 2014-15, compared to budgeted estimates of Rs 2.51 lakh crore.
Also, for 2015-16, the Central Assistance for State and Union Territory plans is budgeted at Rs 2.05 lakh crore, compared with 2014-15 revised estimates of Rs 2.78 lakh crore, to balance out higher tax proceeds to the States from the divisible pool, as recommended by the Fourteenth Finance Commission.
For 2014-15, the non-plan expenditure revised estimates stand at Rs 12.13 lakh crore, compared to Rs 12.20 lakh crore budgeted last year. The 2014-15 revised estimate for plan expenditure is Rs 4.68 lakh crore, compared to budgeted estimate of Rs 5.75 lakh crore.
Read our full coverage on Union Budget
Read our full coverage on Union Budget
As expected, the government slashed down heavily on its spending in 2014-15 to meet its fiscal deficit target of 4.1 per cent of Gross Domestic Product. For example, just in plan spending, the Finance Ministry managed to slash the Central Plan by Rs 46,826 crore, and Central assistance to States and Union Territories by Rs 60,240 crore.
This is the second year in running when the government has had to cut its expenditure in this range and the third year in a row of huge spending cuts. The government had slashed expenditure to the tune of Rs 79,653 crore in 2012-13 and Rs 1.02 lakh crore in the 2013-14 compared to what was projected in the budget for those fiscals.
Last year, the Centre had introduced a fresh round of austerity measures, aimed at a mandatory 10 per cent reduction in minor Non-Plan items. As reported by Business Standard earlier, there has been around 20 per cent cut in Plan allocation of key ministries, with the magnitude of cuts varying from one ministry to another.
