The Union Budget Game:
Who wants to be the finance minister?

Crafting the budget is an annual reminder of a fundamental lesson of economics: we have scarce resources to pursue a multitude of goals.

While governments have more leeway to borrow compared to private firms or individuals, they too are subject to the constraints imposed by their creditors. Just as people and companies make tough decisions every day, so must policymakers accept trade-offs: pursuing one goal often means giving up another. But for the government, the stakes are much higher because the trade-offs involve the lives of millions.

In this budget game, you have a chance to play the finance minister. You’ll start by deciding what cuts are needed. Remember, cutbacks may upset people.

After making cuts, you can decide what to spend on and how much. Be careful: too much splurging will increase the fiscal deficit, raising borrowing costs, stoking inflation, and undermining the economy’s stability.


Below is a list of programs that policy makers have considered reducing or eliminating. Which ones are you willing to give up?

FY 17-18 allocation

Choose spending items »

Hopefully, you’ve made enough cuts that you can add the programs you think are more important. What would you like to add?

FY 17-18 allocation

Choose items to cut »

You have not made any changes to the budget. Choose items to cut or to spend on.

The choices available in the game are largely based on past recommendations made by policy-makers and economists, and on publicly available assessment reports of the government’s schemes. The financial allocations for each scheme or project are based on last year’s budget estimates for the current fiscal year.

To be sure, the list of choices is not an exhaustive one. It does not include several items that are not part of the budgeting exercise but which can contribute to the exchequer and help meet the government’s spending needs. For instance, the government could ask its top bureaucrats and ministers to give up on their palatial bungalows in Lutyens’ Delhi, and monetize the land to raise budgetary resources. There are at least 507 such (type 7 and type 8) bungalows in the Lutyens zone, with an estimated land area of 1.76 sq km. Applying the circle rate of Rs 7.74 lakh/metre, the estimated value of this land alone is Rs 1.36 trillion, enough to finance the fiscal deficit for a couple of years.

The list of choices also does not include sales of state-owned firms from which the government could potentially raise much more money. The government is expected to target Rs 1 trillion in stake-sales over the next fiscal, but it could potentially raise much more by pursuing a more aggressive divestment agenda.

None of these decisions are easy ones though. The decision to monetize Lutyens land will invite the wrath of the most powerful men and women in the country. An aggressive divestment agenda will upset trade unions and employees of state-owned firms, inviting protests from them.

Still, when Arun Jaitley steps to the floor of parliament on February 1 to present the Union Budget for 2018-19, think of the choices you made in this game. They’re exactly the sorts of tough choices the finance minister himself had to make.

1. The allocation for judiciary reflects allocation for judicial infrastructure as well as allocation for central schemes relating to legal reforms.
2. The allocation for modernization of police relates only to the funds alloted for modernization of police force, and not for other heads of expendture related to policing.
3. The budgetary allocation shown here for railways denotes the net budgetary support, and does not include other forms of financing for railways such as through the special fund for railway safety, Rashtriya Rail Sanraksha Kosh.
4. The budgeted fiscal deficit for the current fiscal was estimated to be 3.2 percent of GDP in the Budget last year based on the growth projection available at that time. But based on the latest estimates of GDP growth published by the CSO (which is lower than the earlier projection), the budgeted fiscal deficit turns out to be 3.3 percent.

Heart by Ker'is, Justice by Gregor Cresnar, Police by Arthur Shlain, Oil by Ayub Irawan, Fertilizer by Ayumi Aya, Capitol Building by Creative Stall, Modem by ProSymbols, Train by Creative Stall, Megaphone by Gregor Cresnar, broadcast by Manohara, Grains by James Fenton, Art by Becris, Herbal by Delwar Hossain, Outfall by Luis Prado, Training by Arafat Uddin, Jet Plane by Arif Fajar Yulianto, Teacher by designvector, Road by Sergey Krivoy, Factory by Laymik, power line by Creative Stall, Farmer by Luis Prado, statistics by Scott Lewis, farm land by art shop, Grandparents by Marie Van den Broeck

Complete coverage of the 2018-2019 Union Budget from the Hindustan Times »