Defence Ministry gets record Rs 6.2 lakh crore allocation

New Delhi, July 23: The Union Budget 2024-25 allocated Rs 6,21,940.85 crore (approximately US $75 billion) to the Ministry of Defence (MoD), the highest among all ministries.

This includes an additional Rs 400 crore for innovation in defence through the Acing Development of Innovative Technologies with iDEX (ADITI) scheme.

The allocation for FY 2024-25 is approximately Rs 1 lakh crore (18.43 percent) higher than FY 2022-23 and 4.79 percent more than FY 2023-24.

BREAKDOWN OF ALLOCATION

A total 27.66 percent of the defence budget is for capital expenditure, 14.82 percent is for revenue expenditure on sustenance and operational preparedness, 30.66 percent is for pay and allowances, 22.70 percent is for defence pensions, and 4.17 percent for civil organisations under the MoD.

BUDGET SHARE

The total allocation represents about 12.90 percent of the Union Budget.

Defence Minister Rajnath Singh praised the budget as "excellent and outstanding," stating that it aligns with Prime Minister Narendra Modi’s vision of inclusive and fast-paced development.

He expressed confidence that the capital outlay of Rs 1,72,000 crore would strengthen the armed forces' capabilities and support domestic capital procurement, advancing self-reliance in defence.

INNOVATIVE AND INDIGENOUS DEVELOPMENT

iDEX Scheme: The ADITI scheme will engage start-ups, MSMEs, and innovators to develop defence technology solutions.

Grants of up to 50 percent of the Product Development Budget, with a maximum of Rs 25 crore per applicant, would be awarded.

Domestic Procurement: 75 percent of the modernisation budget, amounting to Rs 1,05,518.43 crore is earmarked for procurement from domestic industries, boosting GDP, employment, and capital formation.

CAPITAL EXPENDITURE

The capital allocation for the Defence Forces is Rs 1.72 lakh crore, 20.33 percent higher than FY 2022-23 and 9.40 percent more than FY 2023-24.

This aims to fill critical capability gaps through significant acquisitions, including advanced technology, weapons, aircraft, ships, submarines, UAVs, and specialist vehicles.

OPERATIONAL READINESS AND SUPPORT

Rs 92,088 crore has been allocated for operational readiness, which is 48 percent higher than FY 2022-23, to ensure the armed forces remain battle-ready.

This includes maintenance facilities, ammunition procurement, resource mobility, and support for deployments in forward areas.

VETERANS' HEALTHCARE

Rs 6968 crore has been allotted to the Ex-Servicemen Contributory Health Scheme (ECHS), a 28 percent increase from the previous year, continuing the significant enhancement made in FY 2023-24.

BORDER INFRASTRUCTURE DEVELOPMENT

Rs 6500 crore has been allocated to the Border Roads Organisation (BRO), 30 percent higher than FY 2023-24 and 160 opercent more than FY 2021-22.

This will support strategic projects like the Nyoma Airfield in Ladakh and tunnels in Himachal Pradesh and Arunachal Pradesh.

INDIAN COAST GUARD

Rs 7651.80 crore has been allocated to the Indian Coast Guard, 6.31 percent higher than FY 2023-24. This includes Rs 3500 crore for capital expenditure, enhancing maritime capabilities and humanitarian assistance efforts.

RESEARCH AND DEVELOPMENT

The allocation for the Defence Research and Development Organisation (DRDO) has increased to Rs 23,855 crore, with Rs 13,208 crore earmarked for capital expenditure.

The Technology Development Fund (TDF) scheme is allocated Rs 60 crore to support start-ups, MSMEs, and academia in innovation.

Allocation for iDEX has increased from Rs 115 crore in FY 2023-24 to ₹518 crore, fostering innovation in defence technology.

Total budgetary allocation on account of defence pensions is Rs 1,41,205 crore which is 2.17 percent higher than the allocation made during 2023-24.

It would be incurred on monthly pension to approximately 32 lakh pensioners through the System for Pension Administration (Raksha) or SPARSH and through other pension disbursing authorities.