Union Budget 2019: Railway Budget ceased to be a separate event in 2016, ending 92-year-old history

The decision to merge the Railway Budget and the General Budget was based on the recommendations of the committee chaired by Bibek Debroy, a member of NITI Aayog.

FP Research June 20, 2019 15:10:20 IST
Union Budget 2019: Railway Budget ceased to be a separate event in 2016, ending 92-year-old history
  • The government decided to merge both the Union Budget and the Railway Budget from 2017

  • The NITI Aayog committee noted that a separate Railway Budget was just an annual ritual

  • Mamata Banerjee became the first railway minister of India in 1999 under the Atal Bihari Vajpayee-led NDA govt

The Railway Budget is the annual financial statement of the state-owned Indian Railway, which operates the rail transport in the country. Earlier, the Railway Budget was presented a couple of days ahead of the General Budget by the railway minister in the Parliament.

Railway Budget merged with general Budget

The 92-year old practice of presenting a separate Railway Budget came to an end during the Narendra Modi government on 21 September 2016. The government decided to merge both the Union Budget and the Railway Budget from the year 2017-18.

Union Budget 2019 Railway Budget ceased to be a separate event in 2016 ending 92yearold history

Representational image. PTI

The decision to merge the Railway Budget and the General Budget was based on the recommendations of the committee chaired by Bibek Debroy, a member of NITI Aayog. The decision was also based on a separate paper on ‘Dispensing with the Railway Budget’ by Debroy along with Kishore Desai.

The NITI Aayog committee noted that a separate Railway Budget was just an annual ritual that should be done away with.

In April 2017, then railway minister Suresh Prabhu had said that he himself had volunteered for the clubbing of Railway Budget with the General Budget, and it was "not a takeover" by the finance ministry.

Ending a nearly century-old practice of having a separate budget for the Indian Railways, the government from the 2017 financial year merged it with the General Budget, which was presented by then finance minister Arun Jaitley on 1 February 2017.

In February this year, finance minister Piyush Goyal in the interim Budget announced a capital expenditure allocation of Rs 1.58 lakh crore for the railways, the highest-ever for the national transporter, in an effort to put its flagging revenues back on track.

History of Railway Budget

The recommendation of the Acworth Committee in 1920-21, headed by British railway economist William Acworth, led to the reorganisation of the railways in India. Accordingly, the railway finances were separated from the general government finances in 1921. After that in 1924, the Budget was announced, a practice that continued till 2016.

John Mathai presented the first Railway Budget of independent India in November 1947.

Mamata Banerjee, first woman railway minister

Mamata Banerjee became the first railway minister of India in 1999 under the Atal Bihari Vajpayee-led NDA government. She was the railway minister under the Congress-led United Progressive Alliance (UPA) government as well.

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