Finance Commission and Budgetary Process from "summary" of Objective Indian Polity General Studies Paper - 1 by M. Laxmikanth
The Finance Commission plays a crucial role in the budgetary process of India. It is a constitutional body that is responsible for recommending the distribution of financial resources between the Union government and the state governments. The recommendations made by the Finance Commission are crucial in determining the financial relations between the Centre and the states. The Finance Commission is constituted by the President of India every five years or at such intervals as he may deem necessary. The Commission consists of a chairman and four other members who are experts in finance and economics. The recommendations made by the Finance Commission are laid before the Parliament by the President, and it is up to the government to implement them. The recommendations of the Finance Commission are taken into account by the government when preparing the Union Budget. The Union Budget is an annual financial statement that outlines the government's revenue and expenditure for the upcoming fiscal year. It is presented to the Parliament by the Finance Minister. The budgetary process in India is a complex and detailed one that involves various stages. It begins with the presentation of the budget in the Parliament, followed by discussions and debates on its provisions. The budget is then passed by the Parliament, after which it becomes law. The budgetary process is an essential tool for the government to allocate financial resources efficiently and effectively. It helps in setting priorities, determining spending levels, and ensuring accountability in the use of public funds. The Finance Commission plays a crucial role in this process by providing recommendations that guide the government in its budgetary decisions.- The Finance Commission and the budgetary process are interconnected and play a vital role in the financial management of India. The recommendations of the Finance Commission inform the government's budgetary decisions, which in turn shape the country's fiscal policies and priorities.
