Sign in Subscribe
Defence buying

Defence Budget 2024-25: A Budget of Progress and Self-Reliance

Strategic Insights

— 2 min read

The Union Government has announced a significant increase in the Defence Budget for the Financial Year 2024-25, allocating Rs 6,21,940.85 crore (approximately USD 75 billion). This allocation is the highest among all ministries and represents an increase of approximately 18.43% over the previous year's allocation. The Defence Budget is aimed at promoting self-reliance in defence technology and manufacturing, equipping the Armed Forces with modern weapons and platforms, and creating job opportunities for the youth.

Key Takeaways:

  • The Defence Budget for FY 2024-25 is Rs 6,21,940.85 crore, an increase of approximately 18.43% over FY 2022-23 and 4.79% over FY 2023-24.
  • The capital allocation under the Defence Budget is Rs 1,72,000 crore, a 20.33% increase over the actual expenditure of FY 2022-23 and 9.40% higher than the Revised Allocation of FY 2023-24.
  • The budget allocation is aimed at filling critical capability gaps through big-ticket acquisitions in the current and subsequent financial years.
  • 75% of the modernisation budget (Rs 1,05,518.43 crore) is earmarked for procurement through domestic industries, which will have a multiplier effect on GDP, employment generation, and capital formation.
  • The allocation for operational readiness has been increased by 48% over FY 2022-23, boosting the morale of the Armed Forces and providing best maintenance facilities and support systems.
  • The Government has committed to providing better healthcare facilities to veterans through the enhanced allocation to Ex-Servicemen Contributory Health Scheme (ECHS), which stands at Rs 6,968 crore (28% higher than the previous year allocation).
  • The allocation to the Indian Coast Guard has been increased by 6.31% over FY 2023-24, with Rs 3,500 crore allocated for capital expenditure to add teeth to the arsenal of the ICG.
  • The Defence Research and Development Organisation (DRDO) has been allocated Rs 23,855 crore, with a major share of Rs 13,208 crore allocated for capital expenditure.
  • The allocation to the Technology Development Fund (TDF) scheme has been increased to Rs 60 crore, designed to attract young bright minds in innovation and developing niche technology in collaboration with DRDO.
  • The Government has increased the allocation on innovation in defence through the iDEX scheme from Rs 115 crore in FY 2023-24 to Rs 518 crore in the current fiscal year.
  • The Defence Pension Budget has been increased to Rs 1,41,205 crore, a 2.17% increase over the allocation made during FY 2023-24.

Statistics:

  • Rs 6,21,940.85 crore: Defence Budget for FY 2024-25
  • 18.43%: Increase in Defence Budget over FY 2022-23
  • 4.79%: Increase in Defence Budget over FY 2023-24
  • Rs 1,72,000 crore: Capital allocation under Defence Budget
  • 20.33%: Increase in capital allocation over actual expenditure of FY 2022-23
  • 9.40%: Increase in capital allocation over Revised Allocation of FY 2023-24
  • Rs 1,05,518.43 crore: Earmarked for domestic procurement (75% of modernisation budget)
  • 28%: Increase in Ex-Servicemen Contributory Health Scheme (ECHS) allocation over previous year
  • 6.31%: Increase in Indian Coast Guard allocation over FY 2023-24
  • Rs 3,500 crore: Capital expenditure allocated to Indian Coast Guard
  • Rs 23,855 crore: Allocation to Defence Research and Development Organisation (DRDO)
  • Rs 13,208 crore: Capital expenditure allocated to DRDO
  • Rs 60 crore: Allocation to Technology Development Fund (TDF) scheme
  • Rs 518 crore: Allocation to innovation in defence through iDEX scheme

Sources:

  • Taxindiaonline.com Pvt. Ltd.
  • Contify.com

Read more