February 1, 2021

Capital outlay increased by nearly 19 per cent giving defence modernization historic push

Defence Minister thanks Prime Minister & Finance Minister for increasing defence budget to 4.78 lakh crore

Union Budget for the Financial Year 2021-22, presented by the Finance Minister Nirmala Sitharaman in the Parliament on February 01, 2021 has given a historic push to defence modernisation by increasing defence capital outlay by 18.75 per cent.

Defence allocation in the budget has been increased to Rs 4,78,195.62 crore for the Financial Year 2021-22. Excluding Defence Pension, the total allocations for Defence Services and other organisations/Departments under Ministry of Defence for the FY 2021-22 is Rs 3,62,345.62 crore which is an increase of Rs 24,792.62 crore over the Current FY 2020-21.

The allocation under capital expenditure which relates to modernisation and infrastructure development of Armed Forces has been significantly increased. The allocation under Capital of Rs 1,35,060.72 crore for FY 2021-22 represents an increase of 18.75 per cent over FY 2020-21 and 30.62 per cent over FY 2019-20. This is the highest ever increase in capital outlay of Defence in the last 15 years.

(Rs in Crore)
Capital Outlay on Defence Services
Year Capital BE Increase %age increase
2019-20 1,03,394.31 9,412.18 10.01
2020-21 1,13,734.00 10,339.69 10.00
2021-22 1,35,060.72 21,326.72 18.75

Allocation under Non-Salary Revenue to meet operational requirement has been increased to Rs 54,624.67 crore. This is 6 per cent growth over FY 2020-21.

The Capital allocation for DRDO has been increased to Rs 11,375.50 crore. This is an increase of 8 per cent over 2020-21 and 8.5 per cent over 2019-20. The allocation for Border Roads Organisation (BRO) has been increased to Rs 6004.08 crore which is 7.48 per cent increase over FY 2021-22 and 14.49 per cent over FY 2019-20.

Defence Minister Rajnath Singh has thanked Prime Minister Narendra Modi and Finance Minister Nirmala Sitharaman for increasing the defence budget to 4.78 lakh crore for the Financial Year 2021-22 (FY21-22), which includes capital expenditure worth Rs 1.35 lakh crore. It is nearly 19 per cent increase in Defence capital expenditure. This is the highest ever increase in capital outlay for defence in the last 15 years.

Defence Minister said special attention has been paid to economic reforms, employment generation, capital formation and creating infrastructure in India. “Based on 6 pillars of good governance this Budget will usher India into a new era of inclusive growth and prosperity,” he said.

Rajnath Singh in a series of tweets said, “Several new policies & programmes to support India’s farmers, agriculture, infrastructure and reinvigoration of Human Resource have also been announced. I am glad that the Budget has proposed the opening of 100 new Sainik Schools in the country.” These schools will be set up in partnership with States, Non-Governmental Organisations (NGOs) and private institutions.

Also Read: Double-Engine Government turns out to be Double CM government: Congress

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