In a significant move during her Union Budget speech, Finance Minister Nirmala Sitharaman has allocated Rs 6.81 lakh crore to the defence sector for FY25, marking a modest increase from last year’s allocation of Rs 6.21 lakh crore. This reflects the government’s unwavering focus on fortifying India’s defence capabilities.
A large portion of this year’s budget, Rs 1.92 lakh crore, has been earmarked for capital expenditure, focusing on modernizing military infrastructure, enhancing equipment, and upgrading technology. Among the capital outlays, Rs 48,614 crore has been set aside for aircraft and aero engines, while Rs 24,390 crore will go toward the naval fleet. An additional Rs 63,099 crore will fund other essential defence equipment to bolster operational readiness.
On the revenue side, the budget allocates Rs 4.88 lakh crore for recurring expenses, which includes a significant Rs 1.60 lakh crore for pensions, ensuring the welfare of defence personnel while maintaining operational efficiency across all services.
In comparison to FY24, when Rs 6.21 lakh crore was allocated to defence, this year’s allocation shows a slight increase. Last year’s capital outlay stood at Rs 1.72 lakh crore, demonstrating the Government’s commitment to enhancing defence infrastructure and operational preparedness.
Furthermore, a statement from the Ministry of Defence highlighted a landmark achievement in the country’s defence sector, with defence production reaching a record Rs 1.27 lakh crore, while exports surged to Rs 21,083 crore in FY 2023-24. This growth signifies country’s rising stature as a global defence manufacturing hub, driven by initiatives like “Make in India” and “Aatmanirbharta.”
Looking ahead, India has set ambitious goals for the defence sector, aiming to triple defence production to Rs 3 lakh crore and increase defence exports to Rs 50,000 crore by 2029. With an eye on expanding capabilities in advanced weaponry, aerospace, and naval defence, India is positioning itself as a key player in the global defence industry, poised to meet increasing global demand for high-quality defecse equipment.