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In the Union Budget 2025, the Indian government has announced a significant increase in the defence budget, raising the allocation to ₹6.81 lakh crore, up from ₹6.21 lakh crore in the previous year. This marks a clear emphasis on strengthening India’s military capabilities and advancing the vision of self-reliance in defence production. The enhanced budget reflects the government’s commitment to modernising the armed forces, boosting indigenous manufacturing, and addressing emerging security challenges.
A major highlight of the defence budget is the allocation of ₹1.8 lakh crore for capital outlay, which will be used to acquire new weapons, platforms, and infrastructure. This investment is critical for the modernisation of the armed forces, ensuring they are equipped with cutting-edge technology to tackle evolving threats. The budget also continues to prioritise the ‘Make in India’ initiative, aiming to reduce dependency on imports and promote domestic defence production. In 2024, India achieved a record-high indigenous defence production value of ₹1.26 lakh crore, while defence exports reached an all-time high of ₹21,083 crore, showcasing the growing capabilities of the domestic defence sector.
The budget supports the induction of indigenous platforms, such as the light tank ‘Zorawar’, designed to enhance mobility and firepower in high-altitude regions. Additionally, the establishment of facilities like the TATA Aircraft Complex underscores the progress in domestic defence manufacturing. These initiatives align with the government’s broader ‘Aatmanirbhar Bharat’ vision, which seeks to strengthen India’s self-reliance in critical sectors, including defence.
However, challenges remain in the allocation of funds. Only 27.66% of the defence budget is earmarked for capital expenditure, with the majority allocated to personnel expenses such as salaries and pensions. This distribution highlights the need for greater investment in research and development (R&D) to maintain a competitive edge in defence technology. Experts have called for increased funding in R&D to foster innovation and develop next-generation defence systems.
The increased defence budget also comes at a time when India is navigating complex geopolitical dynamics, including border tensions and regional instability. The government’s focus on modernising the military and supporting indigenous defence enterprises reflects its strategic intent to safeguard national security and reduce external dependencies.
Key Highlights of Defence Budget 2025:
- Total defence allocation increased to ₹6.81 lakh crore, up from ₹6.21 lakh crore in 2024.
- ₹1.8 lakh crore allocated for capital outlay to acquire new weapons, platforms, and infrastructure.
- Record-high indigenous defence production value of ₹1.26 lakh crore achieved in 2024.
- Defence exports reached ₹21,083 crore, marking a significant milestone.
- Induction of indigenous platforms like the light tank ‘Zorawar’ and development of facilities such as the TATA Aircraft Complex.
- Emphasis on ‘Make in India’ and ‘Aatmanirbhar Bharat’ initiatives to boost self-reliance in defence production.
The Union Budget 2025 underscores India’s commitment to building a robust and self-reliant defence sector. By prioritising modernisation and indigenous manufacturing, the government aims to enhance the country’s military preparedness and secure its strategic interests in an increasingly uncertain global landscape.
