Union Budget 2024: As Government's Big Day Approaches, Here's Your Guide To The Financial Jargons

As the fifth-largest economy gears up for the upcoming budget, Finance Minister Nirmala Sitharaman has already highlighted that the interim budget will refrain from featuring any remarkable announcements. Given the approaching Lok Sabha elections early next year, this budget is designated as interim.

This detailed budget presentation is slated to occur following the establishment of the new government post-general elections.

While the nation eagerly awaits the upcoming month, here is your guide to all the budgetary jargons.

Fiscal Balance- It refers to the difference between a government's revenue collection (income) and its expenditures. A fiscal surplus occurs when the government's revenue surpasses its expenditure, while a fiscal deficit occurs when the government's expenditure exceeds its revenue. More like the bottom line for a nation's balance sheet.

GDP- It is the total value of all goods and services produced within a country's borders over a particular time period. It serves as a key indicator of a nation's economic health and is perhaps a dominant term in the financial sphere of every economy. It's like a scoreboard for our economy with no immediate winning/losing.

Divestment- Divestment is the process of selling or disposing of assets, investments, or business units by a company or government. It's majorly done to reallocate resources, reduce debt, or reshape the portfolio. Government can sell off loss-incurring assets/entities via divestment. Getting rid of what's not deemed necessary for growth count in here.

Indirect and Direct Taxes- Shouldn't have been part of the jargon list you say? Nevermind. Direct taxes, like income tax, are levied directly on individuals or businesses, based on their earnings or profits. Indirect taxes, such as GST, STT, and even customs duty, are collected by intermediaries (like retailers) and passed on to consumers through the prices of goods and services.

Inflation- Inflation is the rise in the price level of goods and services in an economy over time. When inflation occurs, the money we have might not go as far, and we might need to pay a bit more to get the same things. The tolerance range of inflation rate, as set by RBI, is between 2 per cent and 6 per cent.

Fiscal Policy- More like a money plan, it's how a government manages its spending and taxation to keep the economy running. By adjusting taxes and government spending, policymakers aim to promote economic growth, control inflation, and manage unemployment. It's like a toolkit governments use to steer the country's financial health.

Economic Survey- An economic survey is like a yearly report card for our country's money matters. It tells us how well we're doing financially, what challenges we might face, and suggests ideas to make things even better. It's like a guidebook for the government's game plan with our economy.

Capital Expenditure- It refers to the funds/investments/expenses spent by the government on long-term projects/policies such as building new roads, schools, or upgrading public facilities. These investments are aimed at improving the country's infrastructure and services, providing sustainable benefits to the citizens for broader economic growth.