As the Union Budget season draws closer, clarity around the difference between an interim budget and a full budget becomes important, especially in an election-linked year.
Finance Minister Nirmala Sitharaman is scheduled to present the Union Budget on February 01, 2026. This will be her 9th consecutive budget in Parliament. Although February 01 falls on a Sunday, the government has confirmed that the Budget presentation will go ahead on the same date, with no change in schedule.
A day before the Budget, the annual Economic Survey will be tabled in Parliament. The survey is the official assessment of the state of the economy and often provides signals on future policy direction. It is prepared by the Chief Economic Adviser in the finance ministry along with his team.
What is an interim budget?
An interim budget is a temporary financial statement presented by the Union government in an election year. Its main purpose is to ensure continuity in governance by seeking Parliament’s approval for essential government spending during the interim period, until a new government is formed and presents a full budget.
In an interim budget, the government avoids announcing major policy measures or long-term reforms. This is because the incoming government may choose a different policy path and is not bound by such decisions.
Since the financial year ends on March 31 and a new government generally takes office by late May or early June, an interim budget helps manage revenues and expenditures during this transition or buffer period.
How is it different from a full budget?
A full or annual budget is the final and detailed financial plan presented by the government for the entire fiscal year. Unlike the interim budget, it lays out complete expenditure plans, revenue sources, and policy priorities.
The full budget has 2 broad components. It presents details of income and expenditure for the outgoing financial year and outlines proposed spending and revenue targets for the upcoming fiscal year. In contrast, an interim budget limits itself to projected revenues and expenses only for the interim period, until the new government presents a full budget for the remaining part of the year.
Another key difference lies in parliamentary scrutiny. A full budget is discussed, debated, and examined in detail in both the Lok Sabha and the Rajya Sabha. Such extensive debate does not usually take place during the presentation of an interim budget.
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