 "Indian Railways")
The allocations towards Indian Railways are among the most anticipated announcements in the Budget. Earlier, a separate budget was provided for railways but the practice was ended in 2017 when Arun Jaitley became the first finance minister to present a combined railway and union budget.
With this, the 92-year-old-long history of the separate railway and union budgets came to an end.
When was the first Railway Budget presented?
The Railway Budget was separated from the General Budget in 1924, after the recommendations of the Acworth Committee in 1920-21. When the first Railways Budget was published in 1924, the Indian Railways was allocated more money than what the country spent on all other administrative departments put together.
John Mathai, an economist, was India's first railway minister and presented the first independent Railway Budget in 1947. Mathai had presented an interim Railway Budget and only after 3 months he presented his second Railway Budget on February 24, 1948.
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How was the Railway Budget merged with the Union Budget?
Before the 2017 Budget, a Niti Aayog commission submitted a white paper recommendation to drop the practice of a separate Railway Budget. The white paper stated that the Railway Budget had dwindled significantly over the years, and hence, a separate Budget was not required.
The white paper also stated that the British began this practice in 1924 since a significant part of the government revenues and the country's Gross Domestic Product (GDP) was dependent on Railway revenues. India was the only country with a separate Railway Budget.
Suresh Prabhu was the last railway minister to present a Railway Budget separately from the Union Budget. The proposal to merge the two budgets was then forwarded to Jaitley by the then Railway Minister Suresh Prabhu.
Prabhu said that this merger proposal was a colonial practice that needed to be ended and would serve the country in the long run.
Finance Minister Arun Jaitley brought the issue up in 2016 at the Rajya Sabha and a special panel was formed to plan the merger of both Budgets. Jaitley said that the practice was adopted because the railway budget used to be higher than the general budget but things have changed with time.
Jaitley went on to present the first combined Union Budget In 2017.
Allocation for railways over the years
An outlay of Rs 2.4 trillion for the financial year 2023-24 (FY23-24) was made by Finance Minister Nirmala Sitharaman for the railways. Here's how it has changed over the years:
Allocation for railways 2022-23
Rs 1.4 trillion was allocated in FY23 for the railways.
Allocation for railways 2021-22
Rs 1.1 trillion was allocated in the FY22 for the railways.
Allocation for Railways 2020-21
Rs 1.34 trillion was allocated by Finance Minister Nirmala Sitharaman for the railways.
Allocation for Railways 2019-20
In the interim Budget, the allocation made for the railways was Rs 1.58 trillion.
