New Delhi: The Central Government has formally started the preparations for the Union Budget for the financial year 2027-28. The Finance Ministry has issued the Budget Circular to take the budget process forward and has set deadlines for all ministries and departments. All ministries have been asked to prepare a detailed assessment of needs, plans and expenditure proposals for the coming financial year.
Its direct impact is not going to be visible on the pockets of common people for now, but the priorities decided in its initial preparation will decide the direction of government expenditure for employment, basic facilities like roads and electricity, digital services, social schemes and development projects in the coming financial year.
Why is this initial process of budget important for the common man?
At the time of budget, people's attention is mostly on taxes, inflation, jobs, subsidies and government schemes. But the foundation of these decisions is laid several months in advance in the budget preparation process.
When ministries send proposals for their plans and expenditure, they try to decide which sectors require how much resources in the next financial year. After this, the Finance Ministry decides the expenditure limit keeping in mind the available revenue and priorities of the government. That is, the initial picture of how much money each sector will get in the budget begins to be formed through this process.
Proposals will have to be submitted by October 6, meetings will start from October 12
According to the Finance Ministry, pre-budget consultation meetings regarding the upcoming budget for 2027-28 will begin from October 12, 2026. For these meetings, ministries and departments will have to submit necessary data and proposals by 6 October 2026.
Under the budget process, departments will have to prepare Revised Estimates (RE) for the financial year 2026-27 and Budget Estimates (BE) for 2027-28. For this, detailed expenditure proposals and assessment of their financial needs have been sought from all the ministries.
Emphasis will be on development and future priorities
In the pre-budget meetings, the financial needs of different ministries, existing projects and upcoming schemes for the general public will be discussed. On the basis of these proposals and discussions, the initial structure of the Union Budget will be prepared.
The upcoming budget is likely to be prepared in line with Prime Minister Narendra Modi's 'Developed India @2047' vision. Ministries have been instructed to prepare their expenditure proposals only on the basis of the agreed priorities and actual financial needs of the government.
The government's priority is to promote spending that can contribute to economic growth, infrastructure expansion, employment generation, digital transformation and social development goals and help move the country forward. It should be like this.
Instructions to limit additional budget demands
The Department of Economic Affairs of the Finance Ministry has directed ministries and departments to present accurate and realistic financial estimates while preparing the Budget Estimates. Also, it has been asked to limit the demand for separate resources, if any, during the financial year as much as possible.
Its objective is to make public finance management more disciplined and effective. It has also been said in the Budget Circular that budget provisions should be proposed only for those schemes and programs which have been approved by the competent authority.
In case of ongoing schemes, description of the approved expenditure plans will also have to be provided.
Grant demands will be prepared through UBIS
All ministries and departments will prepare their detailed demands for grants through the Union Budget Information System (UBIS). The Finance Ministry has asked to maintain complete confidentiality of financial information and documents recorded during the budget process. Everyone has said that there should not be any kind of mistake.
Financial advisors have also been directed to maintain the security of all data and documents recorded in UBIS as per the prescribed standards.
There should be a balance between development and fiscal discipline
With the release of the Budget Circular, the major financial planning process of the Central Government for the financial year 2027-28 has started. It is believed that in the upcoming budget, along with taking forward development-related priorities, special attention will also be given to maintaining fiscal discipline.
How will the budget process proceed from October to December?
The budget process can be broadly understood like this-
– On 6 October 2026, ministries and departments will have to submit necessary data and proposals.
– Pre-budget consultation meetings will begin on 12 October 2026.
– The deadline for submitting estimates related to tax receipt is fixed for 15th October.
– Required disclosure statements must be submitted under the Financial Responsibility and Budget Management (FRBM) framework on 6 November.
After the pre-budget meeting
All ministries and departments will be informed about the initial expenditure limit and on the basis of that, Detailed Demands for Grants will be prepared.
Late December 2026 or early January 2027
The relevant data will be entered into UBIS once the final expenditure limit is decided by the Finance Ministry.
After this, on the basis of these detailed demands, important budget documents like Demands for Grants, Expenditure Budget, Expenditure Profile, Annual Financial Statement and Appropriation Bill will be prepared, which will be presented in the Parliament.
What should the common people expect right now?
Let us tell you that the start of budget preparation does not mean that a decision has already been taken to cut taxes, increase any scheme or make any new announcement. At present, the government is seeking assessment of their needs and plans from ministries and departments.
However, an important signal from this entire process is that in the upcoming budget, the emphasis will be on striking a balance between growth and fiscal discipline. The final picture will be clear to the common people only after the budget is presented in February 2027.
For now, the focus will be on the proposals that the ministry will present before the Finance Ministry in October. On the basis of these proposals and the revenue position of the government, it will be decided in which areas government expenditure will increase in the next financial year and which schemes will get priority.
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