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India Defence Online, New Delhi – In the Indian Union Budget for the year 2011-2012, the Indian Finance Ministry has given special attention to defence by increasing the defence outlay whilst keeping India’s strategic goals at par by facilitating capital for the big-ticket purchases in the current fiscal year.
As per the defence budget for the fiscal 2011-12, the Indian Finance Ministry has given a 11.6 per cent hike which amounts to $34 billion. The hike of 11.6 per cent in defence budgetary allocations is a positive step compared to a mere 4 per cent last year. There has been 9 per cent jump in revenue expenditure and the Finance Ministry has also scaled up capital expenditure by providing more impetus to the modernization plans of the Indian Armed Forces. The defence capital acquisition for the financial year 2011-12 has been hiked to $12.22 billion, while capital expenditure for the same has been raised by about 12 percent to $15.38 billion.
As for the break-up of the total budgetary allocation, the Indian Army has been granted $14.2 billion, Indian Navy $2.35 billion, Indian Air Force (IAF) $3.53 billion and state-owned Defence Research and Development Organisation (DRDO) $1.25 billion. Out of the $15.38 billion capital outlay, the Army got $4.21 billion, Navy $1.26 billion, Naval Fleet $1.62 billion and Air Force $6.82 billion.
It has been largely felt that the Indian Defence Ministry’s past record in utilising the Defence budget and the growing need for homeland security has led to a significant jump in the defence budget. The Indian Defence Ministry has been successful in exhausting the budgetary allocation for two fiscal years now in a row. Meanwhile, the 13.75 percent hike in capital expenditure has been made keeping in mind the big acquisition deals like the $10.2 billion deal for 126 multi-role combat aircraft, the $600 million deal for 197 light helicopters and the $647 million deal for 145 Ultra-light Howitzers for the Indian Army. The largest share of the increased capital expenditure would go to the IAF, which will spend $ 4.9 billion for procuring fighter and transport aircraft and helicopters of different types.
The Indian Defence Ministry has been pleased with the Defence budget and is confident of placing the necessary orders to ensure the current budgetary allocation is rightfully utilised. With the issue of greater homeland security in the Asian region and need for greater presence in the Indian Ocean region looming large, the current defence budget will be of substantial help to the Indian Armed Forces, especially with the Finance Ministry assuring that there would be no dearth of money for important acquisitions in the defence sector if required.
Indian defence news and strategic intelligence
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