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

India's defence budget has remained fairly static for the past five years
Combat Army Aviators Course valedictory ceremonyBCCL

  • 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.

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.

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.

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

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