Manmohan Singh's 'Epochal Budget' to Nirmala Sitharaman's 'Once-in-a-Century Budget' – most iconic budgets that changed India

The 2021 Union Budget, presented by the current Finance Minister Nirmala Sitharaman in 2021, is often regarded as a booster for the COVID-hit economy.

“I rise to present the Budget.” Every February 1st since 2017, India’s Finance Minister begins with these words to present the Union Budget in Parliament. The Union Budget, which is the country’s most important financial event, provides key insights into the policy framework, the economy's health, and the government’s fiscal priorities. As India gears up for this year’s “B-Day,” let’s take a look back at some iconic Budgets over the last seven decades that have shaped India as we know it.

Black Budget (1973): Typically, the term "black budget" refers to the allocation of funds for classified or secret projects. However, in the Indian context, the 1973 Union Budget presented by then Finance Minister Yashwantrao B Chavan is known as the "Black Budget" due to its abnormally high fiscal deficit—Rs 550 crore, to be precise. Key decisions announced during that Budget included the nationalisation of general insurance companies and coal mines. At the time, the Indira Gandhi government argued that the nationalisation of coal mines was necessary to meet the growing power demands. However, post-Budget analysis by several experts suggested that the policy had worsened the coal production ecosystem in the country.

The Epochal Budget (1991): This is the Budget that paved the way for India’s remarkable economic success. Presented by then Finance Minister Dr Manmohan Singh, the "Epochal Budget" was a game-changer with its drastic duty cuts. Dr Singh announced a sharp reduction in customs duties, bringing them down from an exorbitant 220% to 150%. Critical measures were introduced to promote exports and liberalise the economy. Presented during a time of severe economic crisis, this Union Budget by the Narasimha Rao government marked the beginning of India’s liberalisation era, transforming the country into a hub for global trade.

The Dream Budget (1997): In every Budget, the key announcement everyone eagerly awaits is any change in income tax slabs. In 1997, then Finance Minister P Chidambaram accomplished the nearly impossible—reducing income tax rates. His 1997 speech, famously known as the "Dream Budget," introduced several measures to revamp income tax slabs and corporate taxes. Under the United Front government, income tax rates were reduced from 40% to 30%. Additionally, several cesses were completely abolished, marking a significant reform in the tax structure.

The Millenium Budget (2000): As the name suggests, this Budget was presented by then Finance Minister Yashwant Sinha in the year 2000. Sinha announced a systematic phase-out of incentives for software exports. The 2000 Union Budget also lowered customs duties on 21 items, including CD-ROMs and computers, marking a significant step toward fostering technological growth and modernization.

The Roll-Back Budget (2002): A couple of years after presenting the Millennium Budget, then Finance Minister Yashwant Sinha faced the challenge of rolling back several schemes announced in the 2002 Budget speech. The most significant policy reversal, made under pressure from the Opposition, was the proposed increase in LPG prices. This rollback highlighted the political challenges associated with implementing certain fiscal policies.

'Aam Aadmi' Budget (2005): This Union Budget, presented by then Finance Minister P Chidambaram, launched several key welfare schemes. The Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGA), which guarantees 100 days of employment, and the Right to Information Act were introduced in this Budget.

Once-in-a-Century Budget (2021): This Union Budget, presented by the current Finance Minister Nirmala Sitharaman in 2021, is often regarded as a booster for the COVID-hit economy. The Budget prioritized healthcare and infrastructure development, focusing on revitalizing these critical sectors. It also emphasized robust tax collection and privatisation as key components of its strategy.