This time, the general budget of Union Government is likely to be passed on 1 February 2017. So far, the Union Budget was always held in the last 3-4 days of February.
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The decision was also approved by the Chairman of the railway board, AK Mittal.
Regarding the merger of the Railway and General Budget, the Finance Minister said that the distinct identity of the Railways and its functional autonomy will continue. The first Report of Railway Convention Committee (2014), appointed to review the rate of dividend payable by the Railway Undertaking to the general revenue, had also favoured against payment of the dividends, the sources said.
The Finance Ministry and other government departments will now begin working out modalities of the changes made.
As according to the proposal moved by the ministry of finance, Parliament would take a three-week break to complete the ministerial or departmental scrutiny by various parliamentary committees and the break is estimated to be from February 10 or 15 to March 10 or 15. This decision would remove several burden on the Railways including paying dividends to Government every year and Government paying Railways the Gross Budgetary Support.According to the sources, the merger of Railway Budget with annual budget, the Railway Minister’s prerogative and rights related to policy making and planning would not be taken away.
Meanwhile, the finance ministry is looking to sort out taxation issues faced by foreign portfolio investors (FPIs), The Economic Times says in a separate report. The government had earlier said it would like for the Union Budget to be announced in January. Pension liabilities of railways range about Rs 8000 crore annually.
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The country’s largest employer has to bear an additional burden of about Rs 40,000 crore on account of implementation of the 7th Pay Commission awards, besides an annual outgo of Rs 33,000 crore on subsidies for passenger service. This will be in the railways’ interest and also in the nation’s interest.
