India’s defense budget has seen a dramatic increase over the last decade, reaching an approximate 2.5x increase from ₹2.53 lakh crore in 2014 to ₹6.22 lakh crore in 2024. This steady increase places India among the world’s major military spenders, which in turn indicates that the country has strategically focused on modernization and preparedness amidst a complex geopolitical environment.
Continuous Budgetary Growth
The defence budget in FY 2024-25 has increased to ₹6.22 lakh crore, marking a 7.1% increase in total, with pensions included. Excluding pensions, the total allocation stands at ₹4.81 lakh crore, a rise of 8.6% from FY 2023-24. India’s commitment to strong defence capabilities against challenges along its northern borders with Pakistan and China is the underlying factor for the increase in military spending.
Modernization and Capital Expenditure
A considerable part of the defense budget is devoted to modernizing and upgrading technology for the armed forces. During
FY 2024-25, ₹1.72 lakh crore, which was 34% of the total defense budget, was kept under capital expenditure. This would provide the armed forces with state-of-the-art weapons and systems that would enable India to counter all the changing global and regional threats.
The government has further emphasized Aatmanirbharta in defence, driving domestic manufacturing and technological development. Notably, 75% of the capital budget for modernisation—amounting to ₹1.05 lakh crore—was earmarked for procurement through domestic industries in FY 2024-25, reflecting a strong push towards reducing dependence on foreign imports.
India’s defence R&D budget is around ₹13,200 crore. In the absence of critical indigenous technologies, this figure is likely to increase in the coming years. Increased investment in R&D is crucial for achieving self-reliance and filling the technological gaps in missile systems, cyber warfare, and artificial intelligence, among others.
Strategic Imperatives Driving the Budget Surge
Major defence expenditure in India is due to its changing geopolitics, hostile relations with Pakistan, border tension with China, and the expansionist policies of the northern neighbour. Global conflicts, such as the Russia-Ukraine war and Middle East instability, also add fuel to the demand for robust defense capabilities. These factors thus collectively highlight a need for investments in India regarding military strength by the country toward safeguarding interests, ensuring safety, and, above all, maintaining regional security in a fragile and unpredictable global landscape.
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