Merger of Rail Budget with Union Budget

Q.  Which of the following is/are true regarding Merger of Rail Budget with Union Budget?

1) No separate Statement of Budget Estimates and Demand for Grant will be created for Railways.
2) Merger of Rail Budget with Union Budget would facilitate multimodal transport planning.

- Published on 17 Nov 16

a. Only 1
b. Only 2
c. Both 1 and 2
d. Neither 1 nor 2

ANSWER: Only 2
 
The salient features of merger and the benefits likely to accrue therefrom are broadly given below:
  • Ministry of Railways will continue to function as a departmentally run commercial undertaking;
  • A separate Statement of Budget Estimates and Demand for Grant will be created for Railways;
  • A single Appropriation Bill, including the estimates of Railways, will be prepared and presented by Ministry of Finance to Parliament and all legislative work connected therewith will be handled by Ministry of Finance;
  • Railways will get exemption from payment of dividend to General Revenues and its Capital-at-charge would stand wiped off;
  • Ministry of Finance will provide Gross Budgetary Support to Ministry of Railways towards meeting part of its capital expenditure;
  • Railways may continue to raise resources from market through Extra-Budgetary Resources as at present to finance its capital expenditure;
  • The presentation of a unified budget will help present a holistic picture of the financial position of the Government;
  • Merger of Rail Budget with Union Budget would facilitate multimodal transport planning between highways, railways and inland waterways; and
  • It will allow Ministry of Finance greater elbow-room at the time of mid-year review for better allocation of resources, etc.

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