The Union Cabinet on Wednesday may consider the finance ministry's proposals to reform the entire budgetary process, changing India's statistical calendar and advance estimates of GDP for the year.
The finance ministry has proposed advancing the budget presentation date to early February instead of practicing on last working day of the month. It also includes merging the Railway and general budget together and dropping the plan and non-plan distinction.
Under the current system, the budget process is usually over by mid-May, which delays the start of the spending process in the new financial year that begins on April 1.
If the budget is presented one month early, the process can be over by the time the fiscal year starts, said the finance ministry in their official quote. This will mean that the winter session of Parliament will also have to be advanced.
The Cabinet will also consider merging the Railway budget with the general budget and its implications. Under the proposal, the Railways would become a departmentally run commercial, leaving its unique financial autonomy.
According to the change, the concept of capital at charge, a measure of capital support provided by the government, will be removed and the railways would not be required to pay dividends on such capital. The subsidy burden of the railways in this case will fall on the general budget.