The Finance Ministry has formally begun the Budgetmaking exercise for fiscal year 2027-28 (FY28), with the Department of Economic Affairs (DEA) issuing the Budget Circular 2027-28 on August 27. The Union Budget is likely to be presented on February 1, 2027. The circular directs ministries and departments to prepare their Revised Estimates (RE) for 2026-27 and Budget Estimates (BE) for 2027-28 and submit the required data through the Union Budget Information System (UBIS). Pre-Budget meetings, chaired by the Expenditure Secretary, will begin on October 12 and continue till mid-November. Financial Advisers of ministries have been asked to ensure that data specified in the circular is entered into UBIS by October 6, ahead of the meetings. Realistic projection for Revised Estimates (RE) 2026- 27 and Budget Estimates (BE) 2027-28 is a pre-requisite. Proper expenditure estimation by Ministries/ Departments would obviate need for routine/frequent mid-year reappropriations. Minimal mid-year additional resource requirements/ mid-year reappropriations reflect good budgeting,” the circular said.
The BE for 2027-28 and RE for 2026-27 will be provisionally finalised after the pre-Budget meetings. Ministries have been asked to provide details of measures to revise user charges levied by them, their departments and autonomous bodies to recover the current cost of services while ensuring a reasonable return on capital investment. They have also been directed not to include discontinued schemes in the RE for 2026-27. Schemes that will not continue beyond 2026-27 should similarly not receive allocations in the FY28 Budget. Schemes continuing into the 16th Finance Commission cycle are required to be properly appraised and approved before the preBudget meetings. The circular also reiterates strict confidentiality requirements, directing ministries to undertake budget-related data entry on stand-alone, internet-free computers. FY28 will mark Finance Minister Nirmala Sitharaman’s 10th consecutive Budget, equalling the record of late Morarji Desai. The Union Budget, technically known as the Annual Financial Statement, allocates funds to 55 Central ministries and departments under 102 Demands for Grants, besides setting out estimates for the fiscal deficit and the government’s fiscal roadmap. The Budget exercise comes against a challenging global backdrop, with geopolitical tensions, uncertainty in crude oil prices, slowing European economies and a depreciating rupee posing risks to government finances.
