India's defence budget has remained fairly static for the past five years

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  • India’s budget allocation for defence has remained fairly static for the past five years.
  • All three branches of defence— Army, Navy and Air Force — require upgrades but the budget for modernisation falls short.
  • Majority of the defence budget is spent on salaries and pensions of defence personnel.
Nirmala Sitharaman is all set to announce India’s defence budget next month — and things are unlikely to change.

At first glance, it may look like the Indian government has been allocating an increasing amount of funds towards defence.


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While the absolute amount has been increasing, defence expenditure has actually slowed down as a proportion of the GDP. Last year’s budget hit the spotlight for being the lowest since 1962 - which was when India went to war against China.

In 2020, a report by ICICI Securities predicts that the allocation is unlikely to change.


This paints a worrying picture when you see that nearly 60% of the planned budget goes towards pension and services. Last year, that figure jumped to 71% — leaving a mere 3% for civil operations.
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Pensions, alone, have doubled over the past five years from around ₹60,000 crore to ₹112,080 crore. The point of deliberation isn’t just their magnitude, but also their recurring future impact.


Currently, all three branches of India’s Ministry of Defence — the Army, the Navy and the Air Force — require upgrades. However, their modernisation budget falls short of actual requirements by a wide margin.
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Nonetheless, India is the fourth largest military spender in the world according to the World Bank.

See also:
India’s ready to spend on defence — just not on modernisation

Arms spending in Asia continues as India shells out another ₹46 billion

Indian Army fears that foreign intelligence may be using WhatsApp to profile its officers
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