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In which year was the Railway Budget merged with the Union Budget?
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Answer: Option A — 2017
Detailed Solution
The separate Railway Budget was merged with the General (Union) Budget in 2017. On 1 February 2017, Finance Minister Arun Jaitley presented the first combined Union Budget for 2017-18. In the same year, the date of the budget presentation was moved from the last working day of February to 1 February, so that the budget could be passed and put into effect from the start of the financial year on 1 April.
The practice of a separate Railway Budget began in 1924, on the recommendation of the Acworth Committee (1920-21), headed by Sir William Acworth. At that time, the railways were a very large part of the government's finances, and a separate budget was thought necessary to manage them properly. The first Railway Budget of independent India was presented in 1947 by John Mathai. The last separate Railway Budget was presented by Suresh Prabhu in 2016.
The decision to merge the budgets was based on the recommendations of a committee headed by Bibek Debroy, a member of NITI Aayog, in 2015-16. It argued that the railways now formed a much smaller share of total government spending and that a separate budget was no longer needed. After the merger, the Railways remained a separate commercial department, but it no longer pays a dividend to the government, and its plans are included in the Union Budget. The Union Budget is presented under Article 112 of the Constitution as the "Annual Financial Statement".
Another change in 2017 was the abolition of the distinction between "Plan" and "Non-Plan" expenditure.
Why not the other options?
- ✗2014 is the year the new government took office.
- ✗2016 is the year the last separate Railway Budget was presented by Suresh Prabhu.
- ✗2019 is incorrect.
Quick tip
Remember: Railway Budget = separate from 1924 (Acworth Committee), merged with the Union Budget in 2017 (Bibek Debroy committee); budget date moved to 1 February.
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