Finance Minister Nirmala Sitharaman has allocated Rs 4.31 trillion for defence spending (including military pensions of Rs 1.12 trillion), the same as in the February 1 interim Budget. As a proportion of gross domestic product (GDP), however, the allocation is inching steadily lower, towards the 2 per cent mark.
In 2014-15, defence allocations, including pensions, accounted for 17.1 per cent of the central government’s spending, or about 2.28 per cent of GDP. This year, the Defence Budget will comprise 15.5 per cent of government expenditure and only 2.04 per cent of GDP.
In countries like India that face significant security threats, the norm is for defence spending to rise at least in tandem with GDP. Were allocations to have remained at the 2014-15 level of 2.28 per cent of GDP, the military would be getting Rs 50,640 crore more this year than it has received.