Military budget of India

The military budget or defence budget of India is the portion of the overall budget of Union budget of India that is allocated for the funding of the Indian Armed Forces. The military budget finances employee salaries and training costs, maintenance of equipment and facilities, support of new or ongoing operations, and development and procurement of new technologies, weapons, equipment, and vehicles.^[1]

The Indian Army accounts for more than half of the total defence budget of India, with most of the expenditure going to the maintenance of cantonments, salaries and pensions, rather than critical arms and ammunition.^[2]

Overview

India's defence budget includes allocation for the three defence services: the army, navy and air force. It also includes allocation for the ordnance factories, research and development, and capital outlay. Additionally there are civil defence expenditures such as pensions. Unofficial expenditure includes expenses for four of the six Central Armed Police Forces responsible for border security. The space program and atomic energy are funded separately.^[3]

India's official and unofficial defence allocation^[3]
Official status	Category or Demand for Grants (DFGs)		DCE/DSE
Unofficial	Ministry of Defence (Canteen Store Department, MOD Secretariat, Coast Guard, J&K Light Infantry)		Defence Civil (DCE)
Unofficial	Pensions and other benefits		Defence Civil (DCE)
Official defence budget	Operating expenses	Army (including the National Cadet Corps (NCC), Director General of Quality Assurance (DGQA), Military Farms and Ex-Servicemen Contributory Health Scheme)	Defence Services (DSE)
		Navy (Joint Staff)
		Air Force
		Ordnance Factories
		Defence Research and Development Organisation (DRDO)
	Capital expense	Capital outlay (Capital expenditure of all services including the NCC, Ordnance Factories and DGQA)
Unofficial	Border Roads Organisation, Assam Rifles, Border Security Force, Indo-Tibetan Border Police, Sashastra Seema Bal, border management, CAPF construction, border outposts

Expenditures

Share of military services in defence budget in 2020–2021:^[4]

Air Force (23.0%)

Army (56.0%)

Navy (15.0%)

DRDO (6.0%)

2017–2018

The Minister of Finance allocated ₹359,000 crore (equivalent to ₹5.0 trillion or US$60 billion in 2023) of the 2017 Union budget of India for the development of the armed forces, marking a raise of around 7% from the previous fiscal year.^[5]^[6]

2018–2019

In presenting the defence budget of 2018–2019, the Finance Minister allocated ₹404,365 crore (equivalent to ₹5.4 trillion or US$65 billion in 2023) for the Ministry of Defence (MOD).^[7] This translates into an increase of 5.66% over the 2017–2018 defence budget.

2019–2020

As 2019 was an election year the National Democratic Alliance (NDA) government presented an interim budget in place of a regular budget as per the general practice. In the interim budget an allocation of ₹431,011 crore (equivalent to ₹5.4 trillion or US$64 billion in 2023) was made.^[8] On its re-election the NDA government kept the military budget unchanged. However the actual expenditure exceeded the estimated amount and final defence spending for 2019–2020 stood at ₹448,820 crore (equivalent to ₹5.6 trillion or US$67 billion in 2023),^[9] marking an increase of around 10% over the previous budget.

2020–2021

The allocation for defence during the fiscal year 2020–2021 stood at ₹471,378 crore (equivalent to ₹5.5 trillion or US$66 billion in 2023).^[9] This amounted to an increase of nearly 9%.

2021–2022

The allocation for defence during the fiscal year 2021–2022 was ₹478,196 crore (equivalent to ₹5.4 trillion or US$64 billion in 2023), an increase of 1% over the previous year.^[10]

2022–2023

The allocation for defence during the fiscal year 2022–2023 stood at ₹525,166 crore (equivalent to ₹5.6 trillion or US$67 billion in 2023), an increase of nearly 10% over the previous year.^[11] making it the fourth highest in the world after the US, China, and Russia.^[12]^[13]

2023–2024

The defence expenditure for fiscal year 2023–2024 stood at ₹593,538 crore (US$71 billion).^[14]

2024–2025

The defence budget of India was increased to ₹621,940 crore (US$75 billion) in the 2024-2025 union budget from ₹593,538 crore (US$71 billion) during last year. This year’s defence budget accounts for 1.89% of the country’s projected gross domestic product (GDP) for 2024-25.^[15]

Spending as a percentage of GDP

Year	Ruling coalition	Expenditure (%)	Change
2024	National Democratic Alliance	1.89	0.08
2023		1.97	0.24
2022		2.21	0.45
2021		2.66	0.22
2020		2.88	0.36
2019		2.52	0.10
2018		2.42	0.09
2017		2.51	0.00
2016		2.51	0.10
2015		2.41	0.09
2014		2.50	0.03
2013	United Progressive Alliance	2.47	0.07
2012		2.54	0.11
2011		2.65	0.06
2010		2.71	0.18
2009		2.89	0.34
2008		2.55	0.21
2007		2.34	0.18

The above statistics were collected by the World Bank up to 2018.^[16]

Capital acquisition

Service	BE^{[clarification needed]} 2013–2014 (₹ in crore)	RE^{[clarification needed]} 2013–2014 (₹ in crore)	Under/over spending (₹ in crore)	Under/over spending (%)	Interim 2014–2015 (₹ in crore)	% growth of interim 2014–2015 over BE 2013–2014
Army	23,423.23	10,871.22	2,525.82	18.95	20,920.20	56.83
Navy	19,972.78	19,234.32	3,614.47	15.39	23,020.86	1.95
Air Force	37,048.06	36,016.54	1,031.52	2.78	31,817.89	14.12
Total	73,853.88	66,682.07	7,171.81	9.71	75,758.95	2.55

The above data was published by the Institute for Defence Studies and Analyses.^[17]

References

^ Navlakha, Gautam (1999). "Defence Spending: Cost of Fighting Imaginary Enemies". Economic and Political Weekly. 34 (19): 1085–1088. ISSN 0012-9976. JSTOR 4407922.
^ "Defence Manufacturing in India". www.investindia.gov.in. Archived from the original on 3 January 2019. Retrieved 9 July 2021.
^ ^a ^b Behera 2015, p. 236–238.
^ Behera, Laxman Kumar (4 February 2021). "India's Defence Budget 2020-21". MP-IDSA. Retrieved 13 February 2021.
^ Behera, Laxman K (3 February 2017). "India's Defence Budget 2017-18:An Analysis". Institute for Defence Studies and Analyses. IDSA. Retrieved 8 May 2017.
^ "India's defence budget hiked 10pc to INR 2.74 trillion". Dawn. Reuters. 1 February 2017. Retrieved 1 February 2017.
^ Gurung, Shaurya Karanbir (1 February 2018). "Budget 2018: Defence sector gets a boost by 7.81%". Economic Times. Retrieved 26 February 2018.
^ Behera, Laxman Kumar (8 July 2019). "India's Defence Budget 2019-20". MP Institute for Defence Studies and Analyses. Retrieved 14 February 2020.
^ ^a ^b Behera, Laxman Kumar (4 February 2020). "India's Defence Budget 2020-21". MP Institute for Defence Studies and Analyses. Retrieved 14 February 2020.
^ "Budget 2021-22". Press Information Bureau. 1 February 2021. Retrieved 20 August 2023.
^ "Update: India increases defence budget by 10%". Janes.com. Retrieved 20 August 2023.
^ "India world's fourth largest defence spender in 2022, says report". The Economic Times. 26 April 2023. ISSN 0013-0389. Retrieved 20 July 2023.
^ "World military expenditure passes $2 trillion for first time". Stockholm International Peace Research Institute.
^ "Defence Budget of India 2023: India's defence sector gets Rs 5.94 lakh crore for 2023-24". The Economic Times. 2 February 2023. ISSN 0013-0389. Retrieved 20 August 2023.
^ "Unveiling India's Rs 6.21 lakh crore Defence budget with a dual focus on self-reliance and export boost". The Economic Times. 1 February 2024. ISSN 0013-0389. Retrieved 2 February 2024.
^ "Military expenditure (% of GDP) - India | Data". data.worldbank.org. Retrieved 22 June 2020.
^ Behera, Laxman Kumar (23 February 2014). "India's Interim Defence Budget 2014-15: An Appraisal". MP Institute for Defence Studies and Analyses. Retrieved 20 July 2014.

Bibliography

Behera, Laxman Kumar (2015). "15: Changing contours of Indian defence expenditure". In Pant, Harsh V. (ed.). Handbook of Indian Defence Policy: Themes, Structures and Doctrines. Routledge. ISBN 9781317380092 – via Google Books.