The Union Budget underscores the government's dedication to bolstering national defence through substantial financial allocations.
Published Aug 11, 2024 | 12:00 PM ⚊ Updated Aug 11, 2024 | 12:00 PM
The budget for DRDO has been increased to ₹23,855 crore from ₹23,263 crore last year. Out of this, ₹13,208 crore is earmarked for capital expenditure. (Indian Air Force/X)
On 23 July 2024, Finance Minister Nirmala Sitharaman presented a comprehensive budget to Parliament. Given the recent Lok Sabha elections, an interim budget was also presented earlier this year on 29 February.
The latest budget has again put a significant focus on the nation’s defence sector, underscoring the government’s commitment to national security and modernisation.
The defence sector has been allocated a substantial ₹6.22 lakh crore in the budget. This amount is nearly identical to the funds allocated during the interim budget and represents a 4.79 percent increase over the previous financial year’s Budget Estimate.
Notably, this allocation accounts for 12.9 percent of the total budget, highlighting the critical importance of defence in the government’s overall fiscal planning.
The Defence Budget is meticulously subdivided into several categories: MOD (Civil), Defence Revenue, Capital, and Defence Pensions.
MOD (Civil) has been allotted ₹25,563 crores. These funds are designated for revenue and capital expenditures, covering essential services and departments such as the Border Roads, Coast Guard, Defence Estate Organisation, and the Canteen Service Department.
This allocation marks a 13.04 percent increase from the previous year, with a notable 30 percent increase earmarked for the development and improvement of land and maritime infrastructure.
The revenue allocation addresses the pay and allowances of defence personnel, maintenance and repair of equipment, and the support of entities like the Rashtriya Rifles, National Cadet Corps, and the Ex-Servicemen Contributory Scheme. This year, the revenue head has seen a 4.68 percent increase from the previous year, aimed at enhancing the serviceability of existing equipment and improving medical services for ex-servicemen.
Under the capital head, ₹1,72,000 crore has been allocated, reflecting a 5.52 percent increase from the previous year. This segment focuses on procuring modern equipment for the defence forces. Unlike previous budgets, where allocations were made separately for the Army, Navy, and Air Force, this year’s budget consolidates these under a single head, ‘Defence Services.’
This strategic move aims to avoid duplication of purchases and ensure centralised procurement based on priority, thereby utilising funds more economically.
The budget also emphasises long-term planning with an Integrated Perspective Planning approach over a decade, ensuring the availability of funds to support the capability-building process essential for the modernisation of defence forces. Notably, 75 percent of the funds allotted for modernisation are earmarked for procurement through domestic industries, boosting the GDP and increasing employment.
Infrastructure Development
For infrastructure development along the Line of Actual Control (LAC) and Line of Control (LoC), the Border Roads have been allocated 30 percent more funds than last year, ensuring enhanced connectivity and strategic advantage in these critical areas.
An additional ₹400 crore has been allocated for innovations within the defence forces. The MOD is actively engaging with startups and MSMEs to develop cutting-edge defence technology solutions.
Defence Research and Development Organisation (DRDO)
The budget for DRDO has been increased to ₹23,855 crore from ₹23,263 crore last year. Out of this, ₹13,208 crore is earmarked for capital expenditure, which will facilitate the development of new technology.
A sum of ₹1,41,205 crore has been allocated for the pensions of ex-servicemen, marking a 2.17 percent increase from the previous year’s allocation.
This budget underscores the government’s dedication to bolstering national defence through substantial financial allocations. While sudden drastic increases are not feasible, there is a steady and consistent rise in the budget for defence.
The budget not only aims to modernise the defence forces but also supports sustainable economic growth by promoting domestic industries. The focus on long-term strategic planning and innovation ensures that India’s defence capabilities are continually enhanced to meet emerging challenges.
(Colonel Pankaj Narayan (Retd), an IIT-Kharagpur alumnus, is a seasoned telecommunications professional with over 35 years of experience in the Indian Army, specializing in Telecom Spectrum Management, RF Planning and Network Rollout. He has spearheaded major IT/Telecom projects and represented India in international spectrum management forums. Views are personal. Edited by Majnu Babu)
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