Identify the major weaknesses in India’s budgetary process. Suggest reforms to improve fiscal credibility and outcome-based budgeting.

Topic: Government budgeting

Q5. Identify the major weaknesses in India’s budgetary process. Suggest reforms to improve fiscal credibility and outcome-based budgeting. (10 M)

Difficulty Level: Medium

Reference: InsightsIAS

Why the question
Growing concerns over fiscal transparency, off-budget liabilities and weak expenditure-quality monitoring make it essential to strengthen India’s budgetary process and shift towards outcome-oriented governance.

Key Demand of the question
Identify core weaknesses in India’s budgeting architecture and propose reforms that enhance fiscal credibility, transparency, and outcome-based budgeting.

Structure of the Answer:
Introduction

Link credible budgeting with stability, transparency and effective public spending.

Body

• Weaknesses: Indicate one major systemic gap in India’s budgeting process (e.g., weak scrutiny, fragmented planning, opacity).
• Reforms: Indicate one broad reform direction that enhances transparency, oversight or outcome measurement.

Conclusion

Emphasise how a strengthened budget process can improve fiscal discipline and service-delivery quality.