The defence budget was on Thursday increased to Rs 6.21 lakh crore for 2024-25 in a modest hike of 4.72 per cent from last year's allocation of Rs 5.25 lakh crore amid India's continuing border row with China in eastern Ladakh as well as concerns over evolving security situation in the strategic waterways.
In the interim Union budget, Finance Minister Nirmala Sitharaman also announced plans to roll out an ambitious scheme for "deep-tech" technologies in the military domain.
A total of Rs 1.72 lakh crore was set aside to the military for capital expenditure that largely includes purchasing new weapons, aircraft, warships and other military hardware.
For 2023-24, the budgetary allocation for capital outlay was Rs 1.62 lakh crore while the revised estimates put the amount at Rs 1.57 lakh crore.
The defence ministry said, "The announcement regarding a rupees one lakh crore corpus for deep-tech for long term loan to tech-savvy youth/companies and the tax advantage to the start-ups will give further impetus to innovation in the defence sector."
The allocation for capital expenditure for 2024-25 in the defence budget is 20.33 per cent higher than the actual expenditure of 2022-23 and 9.40 per cent more than the revised estimate of 2023-24.
"In the current geopolitical scenario and with the twin objective of promoting self-reliance and exports, the defence budget has touched Rs 6,21,540 crore in the financial year 2024-25," the defence ministry said.
"This comes out to be 13.04 per cent of the total Union budget," it added.
The total revenue expenditure has been pegged at Rs 4,39,300 crore that included Rs 1,41,205 crore for defence pensions, Rs 2,82,772 crore for defence services and Rs 15,322 crore for the ministry of defence (civil).
A total of Rs 6,500 crore has been earmarked to strengthen border infrastructure while Rs 7,651 crore was set aside for the Indian Coast Guard.
The allocation to the DRDO has been pegged at Rs 23,855 crore.
On the overall outlay, the ministry said the allocation is in line with the Long Term Integrated Perspective Plan (LTIPP) of the three services that aims to fill the critical capability gaps by implementing some big ticket acquisitions.
The enhanced budgetary allocation will facilitate in equipping the Armed Forces with state-of-the-art niche technology lethal weapons, fighter aircraft, ships, platforms, unmanned aerial vehicles and drones, it said.
It said the planned modernisation of the existing Su-30 fighter fleet along with additional procurement of aircraft, acquisition of advanced engines for existing MiG-29 jets, acquisition of transport aircraft C-295 and missile systems will be funded out of the budget.
Apart from this, to take the initiative of 'Make in India' further, the Light Combat Aircraft MK'?I IOC/FOC configuration will be additionally funded to ensure state-of-the-art technology in domestic production.
The Indian Navy's major projects such as acquisition of deck-based fighter aircraft, submarines, next generation survey vessels will all materialise through this allocation, the ministry said.
Dr Laxman Kumar Behera, associate professor at Special Centre for National Security Studies at the Jawaharlal Nehru University, described the overall allocation under the defence budget as modest which is reflective of the government's priorities for the military.
"The allocations did not show any lack of commitment to the armed forces," he told PTI.
Dr Behera also described as a "healthy sign" the increase of Rs 10,000 crore in the outlay under capital expenditure.
In the capital outlay for defence services, Rs 40,777 crore has been set aside for aircraft and aero engines while an amount of Rs 62,343 crore was allocated for "other equipment".
An outlay of Rs 23,800 crore has been made for naval fleet and Rs 6,830 crore for naval dockyard projects.
The allocation on account of defence pensions is Rs 1,41,205 crore which is 2.17 per cent higher than the outlay made during 2023-24.
In the budget for 2023-24, the capital outlay for the Indian Air Force was the highest at Rs 57,137.09 crore that included Rs 15,721 crore for procurement of aircraft and aero engines and Rs 36,223.13 crore for other equipment.
The revenue expenditure for the Army has been pegged at Rs 1,92,680 crore for 2024-25 while the Navy and the Indian Air Force have been allocated Rs 32,778 crore and Rs 46,223 crore respectively.
On the allocation for infrastructure projects, the ministry said the projects such as development of Nyoma air field in Ladakh at an altitude of 13,700 feet, 4.1 km strategically important Shinku La tunnel in Himachal Pradesh, Nechiphu tunnel in Arunachal Pradesh and many other projects will be funded out of this allocation.
