DS

Dr. Sachin B L· 2023

Question 9Clarify the challengeGS3GS1

Public expenditure management is a challenge to the Government of India in the context of budget-making during the post-liberalization period. Clarify it.

Open scan (p.23)

Introduction

Public Expenditure Management is the process of managing all functions related to government spending & its control.

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Main Body

[Diagram showing]: Goals of Public Expenditure ManagementFiscal discipline, Strategic resource allocation, Good operational management of Government functions

Post-liberalisation period refers to period after the adoption of LPG reforms of 1991

Public expenditure management challenges in context of budget making:

1Challenges in budget apportion - due to global headwinds like trade wars, covid pandemic, confl, etc
2Increasing burden of subsidies with supply chain constraints or weapons after of supply chain, cite in prices of fertilizer, oil, etc has added to burden of subsidy
3Reduction in corporate taxes - by ruthim in low tax base & more reliance on indirect tax making taxation failing regressive
4Challenges in equitable development - due to diverse & unbalanced economic development across sectors & regions

(i.e. duplex sub) - employ only 12% but contribute around 51% of GDP

5lower social expenditure - government focus shifted from welfare or social security scheme to 'agro it' fauliation rate.

price of fertilizer, oil, etc has added to burden of subsidy

3Reduction in corporate taxes - by ruthim in low tax base & more reliance on indirect tax making taxation falling regressive
4Challenges in equitable development - due to diverse & unbalanced economic development across sectors & regions

(i.e. duplex sub) - employ only 12% but contribute around 51% of GDP

5lower social expenditure - government focus shifted from welfare or social security scheme to 'agro it' fauliation rate.

However, Government measures have ensured that Public expenditure Management is not challenge anymore

1FRBM Act, 2003 - mandates & regulates the fiscal deficit of the government

a) Public Finance Management system - web based online software that tracks funds under all scheme of GoT

b) Adoption of many other digital solution like PFAGAT, Direct Benefit Tranfer, etc

c) Lean Foreign shares or Capital support in form of multilateral institution grants, loans has strengthened government position

d) Way forward:

1Ailan Development Bank commands Accountability, Transparency, Predictability & participation in PEM powers

2a) Fiscal prudence & Fiscal consolidation measure to streamline efficient expenditure

2b) Equal push to both economic development & social security measures allowing holistic development of citizin

Although challenged by LPG measures, Government has difficult tools at his disposal for better PEM powers

374 words22 paragraphs

Conclusion

Although challenged by LPG measures, Government has difficult tools at his disposal for better PEM powers

16 words

  • Clear definition provided
  • Diagram showing goals
  • Multiple challenges identified
  • Reference to post-liberalization context

Topper

Dr. Sachin B L

2023

Subject & Paper

GS3GS1

Topic

Government Finance

Public Expenditure Management

Budget management in post-liberalization

Writing Stats

407

Total words

22

Paragraphs