Defence Budget 2021: Defence Allocation Increased to Rs 4.78 Lakh Crore With 18.75% Hike in Capital Outlay

Union Finance Minister Nirmala Sitharaman on Monday presented the Budget 2021 in the Lok Sabha. A significant push has been given to the defence sector. Defence allocation in the budget has been increased to Rs 4,78,195.62 crore for the Financial Year 2021-22. Excluding defence Pension, the total allocations for Defence Services and other organisations/departments under Ministry of Defence for the FY 2021-22 is Rs 3,62,345.62 crore which is an increase of Rs 24,792.62 crore over the Current FY 2020-21.

The allocation under capital expenditure which relates to modernisation and infrastructure development of Armed Forces has also been increased significantly.  The allocation under Capital of Rs 1,35,060.72 crore for FY 2021-22 represents an increase of 18.75 per cent over FY 2020-21 and 30.62 per cent over FY 2019-20. This is the highest ever increase in capital outlay of Defence in the last 15 years. Defence Budget 2019 is Only 1.5% of GDP Despite Crossing 3-Trillion Mark, Lowest Since 1962 War.

Notably, India spent Rs 20,776 crore on emergency defence purchase amid border tension with China along the Line of Actual Control (LAC). India purchased weapons and systems to boost its military capabilities. In the last budget, Rs 1.13 lakh crore were earmarked as capital expenditure but in the revised estimates in the current budget, the armed forces spent Rs 1.34 lakh crore. The increase in the capital expenditure for the defence sector has come at a time when the country is planning to buy modern weapon systems, including fighter jets.

(Picture Courtesy: Twitter/PIB -Screenshot)

Published by Sumit Sharma

Journalist and passionate for Indian Defence forces.

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