New Delhi [India]: India’s defence budget is set to rise by 9.5%, from ₹6.21 lakh crore to ₹6.81 lakh crore in the 2025-26 financial year, Defence Secretary Rajesh Kumar Singh announced.
Key Highlights of the Defence Budget
Singh stated that India is expected to spend $30 billion annually over the next decade as part of its modernization efforts.
“Out of this capital expenditure (capex) budget, 75% is earmarked for procurement from domestic sources, and 25% of this is set aside for domestic private industry,” he said.
He also highlighted that relaxation in Foreign Direct Investment (FDI) policies and industrial licensing procedures would further drive growth in India’s defence industry.
Growth in Domestic Production and Exports
The total value of domestic defence production in India has reached ₹1.27 lakh crore in 2023-24, with exports surging to ₹21,000 crore, marking a 30-fold increase in the past decade.
“It’s very clear that India’s defence industry is on the brink of a massive expansion. The current industrial ecosystem comprises 16 defence PSUs, 430 licensed companies, and around 16,000 MSMEs,” Singh said.
He emphasized the need to reduce entry barriers for new players and emerging technologies to build an agile and adaptive defence ecosystem, capable of responding swiftly to modern warfare challenges.
India Open to Considering US Offer for F-35 Fighter Jets
Singh also addressed former US President Donald Trump’s recent statement about increasing defence sales to India, including the potential offer of F-35 fighter jets.
However, Singh clarified that the offer has not yet been formally made and that India would evaluate it when it becomes a firm proposal.
“It is not an offer yet. What he (Trump) said is that they will look at a roadmap to make the F-35 available. We will look into the offer after it becomes a firm offer. In any case, our procurements are done through a process,” Singh told ANI.
India’s Procurement Plans and Defence Budget Allocation
India has major defence acquisition plans, with a procurement budget of ₹1,80,000 crore for the next financial year and ₹1,60,000 crore for the current year.
“The Defence Ministry has a structured procurement plan, which includes acquisitions of fighter planes, submarines, and missiles. Announcements will be made only after the procurement process is completed,” Singh said.
During Prime Minister Narendra Modi’s visit to the US, Donald Trump had expressed his administration’s interest in expanding defence sales to India, including paving the way for F-35 aircraft procurement.