Industry Odisha Bureau, Oct 13: Ministries have been asked to flag new spending proposals for 2027–28 early. The Department of Expenditure has opened applications for new budget codes. Fresh demands must compete for room within the Centre’s fiscal consolidation goals.
Every new government scheme needs money, and money is limited. That tension is already shaping India’s next Union budget. Consultations for the FY28 budget, covering 2027–28, began on Monday, 12 October. As budget planning kicks off, the Centre seeks new spending proposals from ministries early.
Ministries move early
The Department of Expenditure has asked ministries and departments to identify fresh schemes early. It has activated the 2027–28 tab on the Controller General of Accounts’ e-Lekha system. Ministries can now apply online there for new budget codes, two officials said. One of them said early requests leave time to examine them and allot codes.
What a code does
Budget codes sort government spending under specific schemes and budget heads. They let the Centre classify and track where money goes, the other official explained. Ministries need these codes to include proposals in their Detailed Demands for Grants. These documents, known as DDGs, set out spending needs for the coming year. The codes sit within the Public Financial Management System, or PFMS. They are shared with the Union Budget Information System, or UBIS. The official who flagged the early timeline added an important caveat. A code neither approves a scheme nor sanctions any funds.
Routine, but useful
Expenditure secretary V. Vualnam told Mint the exercise follows standard budget procedure. Dharmveer, assistant professor at the Delhi School of Economics, said early identification aids fiscal planning. It helps assess funding needs and prioritise spending, he said. It can also align allocations with policy goals and cut last-minute changes.
A crowded field
The FY27 budget shows how crowded the spending field already is. It announced Biopharma SHAKTI to strengthen domestic biologics manufacturing. It also unveiled India Semiconductor Mission 2.0 and a ₹10,000 crore SME Growth Fund. A ₹20,000 crore carbon capture scheme and Bharat-VISTAAR, an AI farm advisory tool, followed.
The fiscal squeeze
FY27 total expenditure was budgeted at ₹53.47 trillion. That was 7.7% above FY26’s revised estimate of ₹49.65 trillion. Receipts excluding borrowings were estimated at ₹36.52 trillion. The gap leaves a fiscal deficit target of ₹16.96 trillion. That is 4.3% of GDP, against 4.4% in FY26. Fiscal consolidation means steadily reducing deficits and public debt. Each new scheme will compete for space on this narrowing path.
Investment and debt
Public investment remains a priority despite the squeeze. Capital expenditure was budgeted at ₹12.22 trillion, or 3.1% of GDP. Effective capex, including state grants for asset creation, was estimated at ₹17.15 trillion. The Centre also targets a debt-to-GDP ratio of 55.6% in FY27, from 56.1%.
Lighter borrowing
The Centre has cut its FY27 market borrowing estimate by nearly ₹1.2 trillion. It now plans to raise ₹15.995 trillion through dated securities, against ₹17.2 trillion budgeted. Of this, ₹7.86 trillion is planned for the second half. The finance ministry released the plan in consultation with the Reserve Bank of India.
Planning before allocation
Early codes make the FY28 budget easier to assemble. They do not guarantee that any new scheme will win funding. The real test comes when spending ambitions meet fiscal limits. For now, ministries are lining up proposals before the money is shared out.

