India's First Budget

Here we take you through the days when it was first presented in Free India and the changes it had gone through till the latest much hyped one by our Current finance minister Mr. Arun Jaitley -

• It was on 7th April, 1860, India’s first budget was presented by James Wilson of East India Company to the British Crown

•  Independent India’s first budget was presented by India’s first Finance Minister R.K. Shanmukham Chetty, 5 pm on 26th November, 1947 and spanned only 7.5 months from August 15, 1947 to March 31, 1948.

•  The day of Budget presentation is always determined by the President; and the whole speech is divided in 2 sections: Part A deals with General Economic Survey and Part B deals with Taxation issues. And, The Government account is categorized into Consolidated Fund of India, Contingency Fund of India and Public Account

•  Until 2000, the norm was to present Budget at 5 PM on the last working day of February, which was changed for the first time by Yashwant Sinha when he started presentation at 11.00 AM during 2001 Budget.

• Morarji Desai is credited with presenting maximum number of budgets in India: 10;. And the finance ministers to have presented 7 budgets are: Pranab Mukherjee, P Chidambaram, Yashwant Sinha, Y B Chavan and C D Deshmukh

•  Jawaharlal Nehru, Indira Gandhi and Rajiv Gandhi are the only Prime Ministers who have also presented Budget inside the Parliament

•  In 1982, when Pranab Mukherjee delivered the budget presentation using 1 hour and 35 minutes, it actually started a trend of delivering long speeches. Indira Gandhi had said after that speech, “the shortest finance minister has delivered the longest budget speech.” In 2003, Jaswant Singh broke that record by using 2 hours to finish his budget presentation. 

•  The budget presented by Manmohan Singh in 1992-93 is often hailed as the most important budget of India ever created. He reduced import duty from 300% to 50%, which liberalized Indian economy, and the modern IT industry owes much of its presence to that decision.

The history of Greece’s financial trouble

Once upon a time, there lived a man named Perikles, who was Athens’ most prominent and influential statesman. In the fourth century B.C. he persuaded the people of Athens to rebuild the temples on the Acropolis, after they had been left in ruins, following a Persian invasion in 480 BC. These temples were structures built to house deity statues within Greek sanctuaries in ancient Greek religion but were very costly to construct. Surviving receipts show that in the rebuilding of the Temple of Artemision of Ephesos, a single column cost 40,000 drachmas, considering that a worker was paid about two drachmas, that equals nearly 2 million Euro (on a modern west European wage scale). Since the overall number of columns required for the design was 120, even this aspect of the building would have caused costs equivalent to those of major projects today (circa 360 million Euro); And this is where the root of Greece’s financial troubles lie. It is stated that back in the fourth century B.C., 13 Greek city-states borrowed from the Temple of Delos. Most of the borrowers, however, "never made good on the loans and the temple took an 80% loss on its principal.” As a reference point, Plato, Aristotle, and Alexander the Great were alive during the fourth century.

Trouble followed Greece in the modern era as well, when Greece defaulted on its external sovereign debt obligations five times: which coincidentally is only half as many times as the default leaders, Venezuela and Ecuador. It started in 1826 during the Greek War of Independence from the Ottoman Empire, followed by the 1843 Bavarian Disaster, when Greece used funds from its Loan of 1832, on the military and "The upkeep of Otto, a Bavarian prince." The country stopped making payments in 1843. Finally after the default in 1860, Greece was kicked out of international markets until 1878. But in 1894 when the markets reopened, lenders were overeager, and borrowing increased to unsustainable levels, finally leading the government to suspend payments in 1893 altogether. In 1932, however Greece suffered a terrible setback during the Great Depression. 

Greece finally gained independence from the Ottoman Empire in 1830 after Great Britain, France, and Russia intervened to help out in the War of Greek Independence but since then, the country has spent 90 out of 196 years of it freedom in financial crisis.

A 2014 study by the European Commission said Greece was the most corrupt country in the European Union — on par with China. Corruption costs Greece about 8% to 10% of GDP per year; and don’t be fooled -Greece is almost five times as big as Massachusetts, however, because of its always brewing troubles, Massachusetts’ GDP is twice that of Greece. Whats more is that, according to a blurb from a University of Chicago paper in 2012, the self-employed Greeks were stated to be paying over 100% of their reported income flows to debt, servicing on consumer loans; truly making Greece's economic nightmare today, much worse than US' was during its Great Depression in 1932.

This state of affairs might have lasted many more years, but when Greece joined the European Union in 1981, European (mainly German) bankers saw an opportunity: they flocked into Greece to offer loans. Even those Greeks who had insufficient income to justify loans grabbed them. Then, the lenders began to demand repayment. Shocked, businesses began to cut back. Unemployment increased. Opportunities vanished.

There is really no chance that the loans will be repaid. They should never have been offered and never should have been accepted. To stay afloat, the government has cut back on public services (except for the military) and the people have suffered. In the 2004 elections, the Greeks had not yet suffered enough to vote for the radical coalition led by the “Unity” (SYRIZA) party. Only 3.3 percent of the voters did.
But then, after the 2008 financial crash, years of worsening hardship fell upon Greece. There was disapproval amongst all politicians, fuelled with boiling anger, about feeling misled by the bankers and their own foolishness. There was also utter hopelessness as Greeks realised that ,they had no way out and thus began to turn to SYRIZA. After a series of failed attempts to secure a mandate, SYRIZA won the 2015 election with 36.3 percent of the vote and 249 out of 300 members of Parliament.

Today, the conditions that impelled that vote are even more urgent: the national income of Greece is down about 25 percent and 23.9% of Greece's population is under the age of 24, while 49.7% of the young and active population is unemployed and 63.5% of Greeks between ages 18 and 34 live at home with their parents. The newly elected SYRIZA party leader Alexis Tsipras talks about The Greek Revival but let me ask you this, how is a nation’s economy suppose to revive, when its entire history and population itself is a major financial crisis?

Author : Neha Sangwan, Batch 20