Capital Outlay for Defence Increased by Nearly 19% Giving Defence Modernisation “Historic Push”


New Delhi: With continuing tension along the borders with Pakistan and China, defence modernisation has been given a “historic push” with the highest ever increase in capital outlay in the last 15 years being raised by almost 19 per cent in the Union Budget for the Financial Year 2021-22, presented by Finance Minister Nirmala Sitharaman in Parliament on February 1.

The allocation for Defence 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 (MoD) 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 been significantly increased. 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.

A comparison of the previous years shows that in 2019-20 it was 10.01 per cent with an increase of Rs 9,412 crore, in 2020-21 it was an increase of 10 per cent with a hike of Rs 10,339.69 crore while in the current 2021-22 it was increased by Rs 21,326.72 crore which is a hike of 18.75 per cent.

The allocation under Non-Salary Revenue to meet operational requirement has been increased to Rs 54,624.67 crore. This is six per cent growth over FY 2020-21.

The Capital allocation for Defence Research and Development Organisation (DRDO) has been increased to Rs 11,375.50 crore. This is an increase of eight per cent over 2020-21 and 8.5 per cent over 2019-20. The allocation for Border Roads Organisation (BRO) has been increased to Rs 6004.08 crore, which is 7.48 per cent increase over FY 2021-22 and 14.49 per cent over FY 2019-20.

Defence Minister Rajnath Singh thanked Prime Minister Narendra Modi and Finance Minister Nirmala Sitharaman for increasing the defence budget to 4.78 lakh crore for the Financial Year 2021-22 (FY21-22), which includes capital expenditure worth Rs 1.35 lakh crore. It is nearly 19 per cent increase in Defence capital expenditure. This is the highest ever increase in capital outlay for defence in the last 15 years.

Singh said special attention has been paid to economic reforms, employment generation, capital formation and creating infrastructure in India. “Based on six pillars of good governance this Budget will usher India into a new era of inclusive growth and prosperity,” he said.

The Defence Minister in a series of tweets said, “Several new policies & programmes to support India’s farmers, agriculture, infrastructure and reinvigoration of Human Resource have also been announced. I am glad that the Budget has proposed the opening of 100 new Sainik Schools in the country.” These schools will be set up in partnership with States, Non-Governmental Organisations (NGOs) and private institutions.

Leave a Reply