The Constitution of India differentiates the governance structure through a three-tier system – the Union government, the state governments, and the local governments. The Union government holds the highest position of power among others.
The central government is bound to lay the ‘annual financial report’ of the country. This report is well known as the 'Union Budget of India' that holds the same character as the budgets of other levels of government, except in the source of revenue and expenditure.
The budget before Independence:
The first Union budget of India was presented during British rule by the then, Finance Minister of India James Wilson on 7th of April 1860 at 5 pm in the evening. The budget presentation practice was started at 5 pm in the evening by Sir Basil Blackett in 1924 to provide reliefs to officials who had worked all night.
Budget Post Independence:
The very first budget of independent India was presented on November 26, 1947, by Sir RK Shanmukham Chetty. While we have witnessed finance ministers posing with a briefcase on the stairs of the Parliament. However, Sir RK Shanmukham Chetty did not carry one; instead, he carried a bag.
The budget then was prepared on the backdrop of Partition riots. Although, the first Budget of 'independent India' was only for seven and a half months and at that time the “interim budget”, a short period budget came on board.
'Time' of the Budget Presentation:
It was a tradition to present union budget at 5 pm in the evening but later, the time was modified in 2001 by the then, finance minister Yashwant Sinha. Till 2000 the budget was presented at 5 pm in the evening and it was revised to 11 am in the morning.
Reason for 'Change in Time'
The reason for the change in the budget timing was also done on a historical basis. It was 20 years before independence i.e. 1927 then, the British officials 'House of Lords' and 'House of Commons' from London also used to take part in the budget presentation. While it was 5 pm in India, it was 11:30 am here in London, that's why the budget was presented at 5 pm in the evening in India.
Post general elections in 1999, Jayant Sinha once again became the Finance and presented annual budgets from 1999-2000 to 2002-2003. In 2001 the change of the time for the union budget presentation from 5 pm to 11 am. Yashwant Sinha was the first finance minister to present Union budget at 11 am.
In 2004, due to elections, an interim budget was presented by Jaswant Singh. Following years, Pranab Mukherjee and P Chidambaram presented the Union Budget under UPA-1 and UPA-2 governments.
Union Budget: Change of date & Railway Budget merger
Under the Prime Minister Narendra Modi government, Finance Minister Arun Jaitley has presented Union Budget in the Parliament. Who last year in 2017, Jaitley announced two key changes in the Union Budget; First, merging of Railway Budget with the Union Budget and Second modifying the Budget presentation from last day of February to the day first of the month. Since then, the Budget is presented on 1st of February at 11 am.