Defence Budget: Amid LAC Rift, FM Nirmala Sitharaman Augments Defence Capital Expenditure By 19%

Defence Budget 2021-22: The considerable increase in the capital outlay is expected to help through several critical purchases, including assault rifles, missiles and land systems in case the standoff at two fronts stretches.

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At a time when India is engaged in a prolonged border tiff with China near Line of Actual Control (LAC) in eastern Ladakh, Union Finance Minister Nirmala Sitharaman has allocated Rs 4.78 lakh crores for the defence ministry. 

The total outlay for the defence ministry is up by 7.4 per cent as against last year’s Rs 4,71,378 crore (including Defence Pension). Excluding pensions, Sitharaman has allocated Rs 3.62 lakh crore for defence expenditure. The considerable increase in the capital outlay is expected to help through several critical purchases, including assault rifles, missiles and land systems in case the standoff at two fronts stretches.

Reacting to this, Defence Minister Rajnath Singh thanked Prime Minister Narendra Modi and Sitharaman for increasing the defence budget. Praising the budget, the minister said that it has been based on six pillars of good governance

"I specially thank PM& FM for increasing the defence budget to 4.78 lakh cr for FY21-22 which includes capital expenditure worth Rs 1.35 lakh crore. It is nearly 19 percent increase in Defence capital expenditure. This is highest ever increase in capital outlay for defence in 15yrs," Singh tweeted.

It is to be noted that the finance minister didn't mention the defence budget allocation during her speech. To this, NITI Aayog Vice Chairman Rajiv Kumar said that the defence budget was a part of the speech but its there as it is important, however it is less connected to our progress and the Budget 2021-22 is focussed on accelerating pace of our progress.

It is pertinent to mention that India is way behind in expenditure on defence in comparison to the neighbouring China, which has spent $261.1 billion on defence budget 2014-2019 while India spent only $71.1 billion.