A government budget may be defined as the annual financial statement containing an estimate of all revenues and expenditures of the government for the coming year. The term “economic growth” refers to a sustained increase in the real GDP of the economy or an absolute increase in the production of goods and services. One of the primary objectives of the government budget is to mobilise resources for production by providing tax rebates, infrastructural stimulation, subsidies etc. For this purpose, the budget of the government may have a liberal expenditure policy in favour of public goods such as national defence, roads, government administration etc., to promote social welfare. The government can use its taxation policy to mobilise resources for investment. The government can also give subsidies to encourage production in some sectors and small scale industries. The government may discourage the production of undesirable goods through heavy taxation.