The Highest Sectoral Outlay for Defence in Interim Budget 2024 can help realise Futuristic Projects

By R. Anil Kumar

• According to Officials who say that the geopolitical situation and twin goals of boosting defence self-reliance and exports prompted the government to allocate 13 per cent of the total budget to the sector

• The government led by Prime Minister Narendra Modi has given defence the highest sectoral allocation in its pre-Lok Sabha election Interim Budget 2024—the key announcements including a whopping 30 per cent outlay hike for the Border Roads Organisation (BRO), in the backdrop of tensions with China, and a Rs. 1 lakh crore corpus for long-term funding of R&D projects, including deep defence technology.

Bangalore, February 3. Expenditure on defence has been raised to Rs. 6.21 lakh crore from Rs. 5.94 lakh crore in the Interim Budget, presented by Smt. Nirmala Sitharaman on 1^st of February. According to defence ministry officials, the current geopolitical situation and twin objectives of boosting defence self-reliance and exports prompted the government to allocate 13.04 per cent of the total budget outlay to the sector.

Officials said the allocation was in line with the Long term Integrated Perspective Plan aimed at filling critical capability gaps through modernisation of the armed forces via big-ticket acquisitions in 2024-25.

The higher budgetary allocation will help equip the armed forces with state-of-the-art, niche weapons technologies, fighter aircraft, ships, platforms, unmanned aerial vehicles, drones, specialist vehicles and more.

The planned modernisation of the existing Su-30MKI fleet of the Indian Air Force, additional procurement of aircraft, acquisition of advanced engines for the MiG-29 jets, and purchase of transport aircraft C-295 and missile systems may also be realised with the extra resources.

Taking the Make in India initiative further, the upgraded indigenous TEJAS MK-1A jet will also be funded to infuse state-of-the-art technologies in domestic production. Indian Navy projects, such as acquisition of deck-based fighter aircraft, submarines and next-generation survey vessels, will also materialise through this allocation.

The defence ministry said the sizeable allocation under the modernisation (capital) budget was aimed at promoting self-reliance in defence; a large portion of the allocation will be used for procurement of domestically manufactured next-generation weapons systems, which is expected to have a multiplier effect on the economy and generate jobs.

The budgetary allocation for defence for FY24-25 is higher by approximately Rs. 1 lakh crore (18.35 per cent) over the allocation for FY22-23 and 4.72 per cent more than the allocation for FY23-24.

Of this, a major share of 27.67 per cent goes to capital, 14.82 per cent to revenue expenditure on sustenance and operational preparedness, 30.68 per cent to pay and allowances, 22.72 per cent to defence pensions, and 4.11 per cent to civil organisations under the defence ministry.

Given the persisting threats from China, the BRO has again received a jump in outlay. The BE 2024-25 allocation is Rs 6,500 crore, 30 per cent higher than in FY23-24. Projects such as the Nyoma airfield in Ladakh, at an altitude of 13,700 feet, permanent bridge connectivity to the southernmost panchayat of India in the Andamans, the 4.1 km-long strategically important Shinku La tunnel in Himachal Pradesh, and Nechiphu tunnel in Arunachal Pradesh are now expected to get a funding boost.

The Defence Research and Development Organisation (DRDO), which is being revamped to meet future challenges, has been allocated Rs. 23,855 crore in FY24-25, as against Rs. 23,263.89 crore in FY23-24.

Of this, a major share of Rs. 13,208 crore is for capital expenditure.

It will financially strengthen the DRDO to develop new technologies and hand-hold private players under the Development cum Production Partner model. Besides, the Rs. 60 crore allocation for the Technology Development Fund Scheme is especially designed for new start-ups, MSMEs and academia attracting young bright minds interested in innovation and developing niche technology in defence in collaboration with the DRDO.