Sun Feb 02 06:21:54 UTC 2025: ## India’s Defence Budget Falls Short of Expectations Despite Increase

**New Delhi, February 2, 2025** – India’s Union Budget 2025-26 allocated ₹6.81 lakh crore (US$82 billion approx.) to the Ministry of Defence (MoD), representing 13.4% of total central government expenditure. While this signifies a 9.53% increase compared to the previous year, concerns remain regarding its adequacy.

A significant portion, ₹4.92 lakh crore (72%), is earmarked for Defence Services, including the Army, Navy, Air Force, and DRDO. Pensionary expenses consume ₹1.61 lakh crore (24%), leaving only ₹28,683 crore (4%) for civil organizations.

According to Laxman Kumar Behera, Associate Professor at JNU’s Special Centre for National Security Studies, inflation and currency depreciation will significantly offset the budget increase. The budget’s allocation heavily favors manpower costs (53% for salaries and pensions), leaving limited funds for modernization and operational preparedness.

Capital expenditure, crucial for modernization, stands at ₹1.8 lakh crore – a mere 4.7% increase following a 7% reduction in the previous year. This limited growth hampers the pace of modernization and indigenization efforts, despite planned mega-contracts for drones, fighters, and submarines.

The MoD aims to boost “Make in India” by allocating 75% of its new capital procurement budget (₹1.49 crore) to domestic industries, with 25% reserved for the private sector. However, Behera argues that the current allocation of 1.9% of GDP to defence is insufficient for a country facing two nuclear rivals, urging an increase to 2.5% in the near to medium term and 3% thereafter.

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