Image Source : INDIA TV Finance Minister Nirmala Sitharaman will present the Union Budget on February 1, 2025.
Budget 2025: Finance Minister Nirmala Sitharaman is set to present her 8th Union Budget on February 1, 2025. This will mark the second budget under Prime Minister Narendra Modi’s third term, and notable attention is expected on the defence sector this time. Experts predict a moderate increase in the allocation for the defence sector this year. Continuing its emphasis on modernisation and self-reliance, the government allocated Rs 6.22 lakh crore to defence in FY 2024-25 — a 4.79% increase over the previous year.
In the interim budget of July 2024, the government allocated Rs 1.72 lakh crore for capital expenditure (capex) in defence, including provisions for:
Rs 6,500 crore for border road infrastructure.
Rs 7,651 crore for coastal security.
Rs 518 crore under the iDEX scheme to promote innovation.
Potential highlights for FY 2025-26
7-8% growth in capital expenditure: Analysts estimate the defence capex could see a 7-8% increase, reaching approximately Rs 1.9 lakh crore.
Boost for Army and Navy allocations: Increased focus on modernising military vehicles and naval assets is expected, while funding for aerospace may remain steady.
A push for import substitution
In a recent report, PhillipCapital analysts highlighted the growing importance of reducing reliance on imports. Despite being the 4th highest defence spender globally, with $84 billion allocated in 2023 (accounting for 2.4% of India’s GDP), India continues to meet 35% of its defence needs through imports. This presents a major opportunity for indigenous production under the government’s ‘Aatmanirbhar Bharat’ initiative.
India’s defence vision: Towards self-reliance
As global tensions rise and the need for robust defence infrastructure grows, the upcoming budget is expected to focus on enabling India’s defence modernisation, enhancing border security, and fostering domestic innovation to reduce dependency on foreign imports. With the stakes high and expectations soaring, all eyes are now on February 1, when the government unveils its blueprint for a stronger, more self-reliant India.
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