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Home > Business > Budget 2006 > Special

How the Budget is kept secret

R Prema in New Delhi | February 24, 2006

It is being guarded like the gold in Fort Knox. High-tech tapping devices, an army of security personnel, sophisticated surveillance gadgetry, digital deterrents, electronic sweeping devices and jammers, huge scanners: the Union Budget 2006-07 documents are under the tightest security in Indian history.

In this electronic age, the Union finance ministry is taking no chances and ensuring that the contents of the Budget to be presented by Finance Minister P Chidambaram in Parliament are not leaked out before he reads his speech at 11.00 a.m. on February 28.

Security agencies have, for the first time, set up a small telephone tapping exchange in North Block. The electronic contraption can intercept private mobile operators' cell numbers. Electronic sweeping devices, installed on either side of the corridors of the finance ministry section of the North Block, fortify the security further.

The mini 'intercepting exchange' will also keep a close eye on the 100-odd landline telephone numbers installed in the chambers of various bureaucrats.

The Intelligence Bureau has also blocked e-mail facilities to most of the computers in the offices of Union finance ministry.

The entrances of the finance ministry itself have been cocooned in an electronic umbrella. A huge steel frame, housing a special X-ray scanner fitted with computers, has been mounted at the gates to prevent anyone from taking anything unwelcome inside the North Block or, more importantly, smuggling anything out.

The finance ministry office, in the North Block of the Central Secretariat, is normally open round the year and you can easily walk in after obtaining a pass at the reception. No more. At least not till the finance minister presents his Budget proposals in Parliament.

Till then the hush-hush work on the Budget, as finishing touches are given to it, is going on in the depths of the North Block.

Heading the secret exercise of the Budget making is Dr Adarsh Kishore, the bearded, 59-year old Union finance secretary. Kishore is summoned by Prime Minister Manmohan Singh and the finance minister every now and then and presented with new ideas and suggestions. Kishore's job is to translate these ideas into facts and figures that go in the Budget Speech and Budget papers.

Insiders say that the guiding principle -- the mantra -- for the prime minister is that the National Common Minimum Programme (NCMP) must jump out of each page of the Budget Speech to let the nation know how sincerely the United Progressive Alliance government is committed to people-oriented progress in India.

The work is gruelling. Long hours, deep thought, no relaxation. . . And Kishore -- who is a 1969 batch Rajasthan cadre IAS officer and who might soon rise to the top post of the bureaucracy as Cabinet Secretary -- has hardly slept for a fortnight.

Apart from his many tasks is also the coordination and monitoring of the timetable of the printing of the Budget speech. Everyday at 8.30 a.m., before the government offices open, he is busy perusing a check list on his table to ensure that everything is going ahead smoothly and will meet the different deadlines set for different parts of the Budget.

Freewheeling Finance Minister

For those who know that the task of Budget preparation demands total commitment in terms of time and effort, it is quite perplexing to see Finance Minister P Chidambaram flying off on frequent foreign trips: to Moscow, to Davos, to Tokyo. . . Especially when nothing other than the impending Budget should hold his entire attention. But insiders say that he is as concerned about the Budget as he is about the upcoming Tamil Nadu assembly elections and about the selection of the right candidates for the six seats in his parliamentary constituency.

While everyone else engaged in preparation of the Budget is required to cut off social contacts completely and stay away from the social gatherings until the D-Day, Chidambaram can be seen merrily attending dinners and get-togethers. The burden of the Budget sits light on his shoulders.

Sources say Chidambaram is able to take it easy since he found the adarsh (ideal) man in Dr Adarsh Kishore, who efficiently handles all these responsibilities.

Kishore can freely walk into Chidambaram's chambers whenever he notices anything awry in any taxation proposal that he has been asked to prepare. And if for some reason Chidambaram is not available, Kishore has been asked to communicate to S Krishnan, an IAS officer of the Tamil Nadu cadre and Chidambaram's private secretary, whatever the finance minister needs to know. Chidambaram, who has full faith in Krishnan, knows his Budget will remain leak-proof.

Sources say that as a prize for providing relentless service to Chidambaram to keep him comfortable, Krishnan is tipped to go to the International Monetary Fund as a senior research fellow on the Indian desk around September.

Krishnan is the son of K Saranyan, a retired IPS officer of the Andhra Pradesh cadre who was the security advisor to late prime minister P V Narasimha Rao. Krishnan's father-in-law is K P Geethakrishnan, former finance secretary.

Meetings & More Meetings

Finance Secretary Adarsh Kishore has till date attended eight meetings on Budget 2006-07 with the prime minister.

Apart from these meetings, Kishore has also held three crucial meetings at the Prime Minister's Office with three key officials: T K A Nair, principal secretary to the prime minister; Rajiv Ratna Shah, member secretary, Planning Commission; and Arun Bhatnagar, member secretary of the National Advisory Council.

Insiders say these latter meetings were more crucial than the ones Kishore had with Dr Singh.

Teams That Make the Budget

There were two teams that were involved in the preparation of the Budget, one political, the other official. The political team consisted of Prime Minister Dr Manmohan Singh, Finance Minister P Chidambaram, Planning Commission Deputy Chairman Dr Montek Singh Ahluwalia and Economic Advisory Council Chairman Dr C Rangarajan.

The official-level team includes:

  • T K A Nair, Principal Secretary to the Prime Minister,
  • Dr Adarsh Kishore, Finance Secretary,
  • Ashok Jha, Secretary, Economic Affairs,
  • K M Chandrasekhar, Revenue Secretary,
  • Parthasarathy Shome, Advisor to Finance Minister,
  • K. Mohandas, IAS (KL 74), Additional Secretary, Revenue,
  • Mrs M H Kherawala, Chairman, Central Board of Excise and Customs,
  • M. Jayaraman, Chairman, Central Board of Direct Taxes,
  • Mrs L M Vas, Joint Secretary (Budget), Department of Economic Affairs, and
  • S Krishnan, Private Secretary to Finance Minister.


The level of secrecy that has been maintained to ensure that there is no Budget leak is phenomenal, to say the least. A horde of the Intelligence Bureau sleuths have taken control of each and every movement and phone call of over a dozen officials in the ministry to ascertain that the Budget remains shrouded in secrecy till it is presented in Parliament.

Those who are being monitored include Dr Adarsh Kishore himself, two of his closest confidants in the Tax Research Unit (TRU) and five stenographers working on the computers delinked from the usual NIC hot link.

The IB surveillance scares those under its watchful eyes so much that they prefer not to speak to even their better halves and children lest they are accused of leaking out any Budget proposal.

Finance Secretary Adarsh Kishore now moves with the highest 'Z' security provided by Delhi Police, in addition to the IB men keeping watch on everything that goes on around him. He moves around with a police vehicle fitted with a wireless set.

Top Secret

The most closely guarded secret is the timing of the printing of the finance minister's speech and the taxation proposals. Insiders say the ministry hands over the material for printing either on midnight of February 25 midnight or early February 26 morning.

The Press Information Bureau officials admit that they are bundled into the press on the night of February 25 to get cracking with the press releases to be put out on February 28. Old timers say that manual typewriters used to be placed in front of the printing press in the underground sections of the North Block till the mid-nineties. After the computer revolution, compact discs are sent to the press.

On the night when the data in the computer, to which nobody except the finance secretary has access, is transferred to CDs to send them for printing. IB, CBDT, and Central Board of Excise and Customs officials stand in front of the computer and sign the list of each file of the confidential papers that is copied on to the CDs.

Delhi Police protection is available to prevent any possible attack on Kishore as the exact Budget proposals are crucial and are known only to him. In fact, he is so steadfast about it that he is himself keying in the taxation proposals, instead of relying on even trusted stenographers.

IB Everywhere

Every year around Budget time, IB asks Delhi Police to provide protection to the finance secretary. The IB chief is also in touch with him on a daily basis. An officer of the Joint Director rank supervises the IB network created at the Budget wing of the North Block. This officer keeps a close watch on the movements of junior or senior officials. Even the peons are under constant surveillance from the beginning of February.

How IB monitors Budget secrecy

A total of 24 officers of the rank of Deputy Superintendent of Police have moved to the North Block. It is a drill that is not known to many. These officers split into four groups and report to the Joint Director (VX). Their prime duty is to keep a watch on a select group of 40-50 officers belonging to the Central Board of Direct Taxes (CBDT), the Central Board of Excise and Customs (CBEC) and others engaged in the Budget preparations.

Since 2004 onwards, a powerful electronic jammer has been installed inside the finance minister's chambers as well as at the entry of the finance ministry corridors. The IB, thus, ensures that all mobile phones are jammed and no information is passed out.


All government publications are printed at the government presses, but not the Union Budget. There is a special printing press in the basement of the North Block to print the Budget. A tight security blanket is spread during the second half of February. Technical heads of the printing press are not permitted to go out of the press from February 24 onwards when they will get the most secret part of the Budget -- personal taxation -- for printing. Already other parts of the Budget are being printed by then.

IB Director E S L Narasimhan has made two secret and surprise visits to the printing press as he thinks he is equally responsible, along with the finance secretary, for ensuring the secrecy and sanctity of the Budget. He will be making at least five to ten visits, at different intervals, to the ministry to ensure that the IB sleuths posted there remain alert.

A mock exercise has been conducted in the past by sending an unknown person with fake papers inside the finance ministry at eleven in the night, just two days before the printing of the Budget. And if he is not nabbed by IB men or by finance ministry officials the entire IB team is kept under suspension for two years. Such is the alertness with which the IB functions for a fortnight.

The printing press itself is housed in a huge space in the depths of the North Block. The area is fully air-conditioned. Dr S Narayan purchased special printing machines just for the Budget in the year 2000, when he was finance secretary, to modernise the Budget printing process.


It is not only the finance ministry officials who are virtually locked in to maintain the secrecy of the Budget, but officials of five other ministries are also quarantined.

Among them are senior legal experts on taxation matters from the law ministry who are given the responsibility of checking the text and wordings of the taxation Acts. There are five law officers who attend the Budget meetings.

The Press Information Bureau officials selected for preparing press notes on the Budget to be distributed to the media as soon as the Budget is presented to Parliament are also locked up inside the ministry building just before the printing of the taxation proposals begins.

The chairmen of CBDT and CBEC also visit the printing press just a day before the Budget presentation.


The presentation of the Budget is in the following order:

  • Key to Budget
  • Budget Highlights
  • Budget Speech
  • Budget at a Glance
  • Annual Financial Statement
  • Finance Bill
  • Memorandum
  • Receipt Budget
  • Expenditure Budget
  • Customs & Central Excise
  • Implementation of Budget Announcements
  • The Macro Economic Framework Statement
  • The Medium Term Fiscal Policy Statement
  • The Fiscal Policy
  • Strategy Statement
  • The Statement under Section 7 of the FRBM Act


The Union Budget defines the nation's financial projections by the Union minister for finance for the forthcoming financial year and a financial review of the current fiscal year. Ultimately, however, Parliament finally decides the Budget.

The imposition of any central government taxes and distribution of government expenditure from public funds cannot be possible without an Act of Parliament, which examines and reviews all statements to ensure the proper dissemination of government expenditures.

Basically it is the Lok Sabha, the House of the People, whose approval is mandatory for the Budget to come into effect.

Proposals for taxation and expenditures can be initiated by the Council of Ministers, specifically the minister of finance. However, according to Article 112 of the Constitution of India, a statement of estimated receipts and expenditure of the Government of India has to be laid before Parliament in respect to every financial year.

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Number of User Comments: 17

Sub: How the Budget is kept secret ?

This article is quite informative. Whenever two or more persons are involved in any work it is extremly difficult to maintain the secracy. Individuals who ...


Sub: How the budget is kept secret

Couldn't the author find an Indian analogy in the opening sentence? Why do nearly all of rediff's columnists suffer from such an embarassingly high degree ...

Posted by Vinit

Sub: Awesome article

The article gives us great details into maintiaining extreme secrecy of the budget which plays a crucia role in our lives.This has increased my confidence ...

Posted by Gaurav

Sub: Much ado abt nothing

Instead of all this bullshit abt keepin the budget secret , if the services of IB are diverted towards stoppin terrorist infiltrating and conspiracy against ...

Posted by Himanshu Pant

Sub: How the Budget is Kept Secret

Good work and Informative

Posted by N Sreenath



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