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Informist, Friday, Jul. 17, 2026

 

NEW DELHI – The finance ministry is considering introducing the first batch of Supplementary Demands for Grants and the Securities Markets Code Bill in the Monsoon session of Parliament starting Monday, a senior government official said. "These bills are still under discussion, and a final call is yet to be taken," the official told Informist. These bills are not marked in the official 'Government Business' that are listed for the upcoming session. 

 

The government last tabled a Supplementary Demands for Grants in the Monsoon session of Parliament during the pandemic-riddled financial year 2021-22 (Apr-Mar). Since then, the government has lowered supplementary demands to two each year – first during the Winter session and second in the Budget session, citing improved budget management. The government tables Supplementary Demands for Grants to seek Parliament's approval for additional spending when the original budget allocations are insufficient. This mechanism allows the government to meet unforeseen expenses, fund new services not included in the annual budget, or adjust allocations mid-year.

 

The government's finances have been under pressure so far this year because of the war in West Asia, with some economists expecting the Centre to miss its fiscal deficit target for FY27. The fear of fiscal slippage is driven by a slowdown in tax collection and potential higher expenditure in the wake of supply bottlenecks and higher commodity prices due to the war. The Union Budget pegged the fiscal deficit for FY27 at 4.3% of GDP, or at INR 16.96 trillion. In March, Minister of State for Finance Pankaj Chaudhary had said that the fiscal deficit target for the year was pegged at 4.5% of GDP, based on the downward revision in India's nominal GDP in the new series with FY23 as the base year.

 

In Apr-May, the government's fiscal deficit was over 12 times the year-ago figure. The fiscal deficit in Apr-May was INR 1.62 trillion, accounting for nearly 10% of the Budget estimate for FY27, compared to less than 1% of the Budget estimate of FY26 in the corresponding period a year ago. The sharp rise in the fiscal gap was due to 18% growth in total expenditure and a 2% drop in revenue. The government's total expenditure in the first two months of the financial year was INR 8.81 trillion, while total receipts were at INR 7.19 trillion.

 

Historically, the finance ministry seeks proposals from ministries and departments ahead of tabling supplementary demands. So far, the government has not asked ministries to submit any proposals. The proposals are invited for only cases where advances from the Contingency Fund have been granted, or where payments against court decrees cannot be postponed, or if there is an immediate need for additional funds which can be met by re-appropriation of savings in the grants. Ministries and departments also submit proposals for cases where the finance ministry has specifically advised to propose supplementary demand, and where excess expenditure has been allowed.

 

SECURITIES MARKETS CODE

The Securities Markets Code Bill seeks to overhaul the securities regulations in India and consolidate provisions of three laws -- the Securities and Exchange Board of India Act of 1992, Depositories Act of 1996, and Securities Contracts (Regulation) Act, 1956. It was first introduced in the Lok Sabha in the Winter Session of Parliament.

 

The bill was tabled in Parliament after nearly four years from its announcement by Finance Minister Nirmala Sitharaman in the Budget for FY22. However, back then, she had announced the consolidation of four laws through the bill--the three mentioned and the Government Securities Act of 2007. Following its introduction in the winter session, the bill was referred to the Parliamentary Standing Committee on Finance to discuss and submit a report on the various provisions of the bill. 

 

To strengthen the capital market regulator, the government, in the bill, had proposed increasing the number of SEBI board members to 15 from the current nine stipulated under the SEBI Act, and it had also proposed new grounds for the removal of board members if they acquire financial or other interests that prejudice their function. The Securities Market Code Bill recognises the concept of market infrastructure institutions, which include stock exchanges, clearing corporations, and depositories. The central government can also notify a new category of market infrastructure institutions, according to the bill. 

 

In April, the Parliamentary Standing Committee on Finance had called a meeting with the industry representatives, considering the bill has significant implications for intermediaries and listed companies. Representatives of the Associated Chambers of Commerce and Industry of India, the Federation of Indian Chambers of Commerce and Industry, and the Confederation of Indian Industry, among other associations, had participated in the meeting, Informist had earlier reported.  End

 

Reported by Priyasmita Dutta

Edited by Akul Nishant Akhoury

 

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