The Union Budget 2025-26 has allocated Rs 6,81,210.27 crore for the Ministry of Defence (MoD), reflecting a 9.53% increase over the previous year’s budget. This accounts for 13.45% of the Union Budget, making it the highest allocation among all ministries. The budget aligns with Prime Minister Narendra Modi’s vision of ‘Viksit Bharat @ 2047’ and focuses on a technologically advanced and ‘Aatmanirbhar’ Armed Forces.

Key Highlights and Analysis of Defence Budget 2025

Budget Allocation Breakdown

• Capital Outlay: Rs 1,80,000 crore (26.43%) for modernisation and infrastructure.
• Revenue Expenditure: Rs 3,11,732.30 crore (45.76%) for pay, allowances, and operational needs.
• Defence Pension: Rs 1,60,795 crore (23.60%) for 34 lakh pensioners.
• Civil Organisations: Rs 28,682.97 crore (4.21%).

Capital Outlay and Modernisation

• Rs 1,80,000 crore allocated, 4.65% higher than last year.
• Rs 1,48,722.80 crore for acquisitions like aircraft, submarines, and AI-driven technology.
• 75% of modernisation budget (Rs 1,11,544.83 crore) for domestic procurement.
• Major purchases include drones, deck-based aircraft, and cyber warfare investments.

Operational and Sustenance Budget

• Rs 3,11,732.30 crore for revenue expenditure, 10.24% higher than 2024-25.
• Rs 1,97,317.30 crore allocated for salaries.
• 24.25% increase in operational funds to strengthen border deployments and military readiness.

Boost for DRDO and Defence R&D

• Rs 26,816.82 crore allocated to DRDO, up 12.41%.
• Rs 14,923.82 crore for R&D, focusing on AI, robotics, and space tech.

Encouraging Startups and Innovation

• Rs 449.62 crore for iDEX & ADITI schemes, tripling in two years.
• Focus on private sector partnerships and defence startups.

Ex-Servicemen Welfare and Defence Pension

• Rs 1,61,000 crore allocated for pensions, 13.87% higher.
• Rs 8,317 crore for Ex-Servicemen Contributory Health Scheme (ECHS), up 19.38%.

Indian Coast Guard (ICG) Enhancements

• Rs 9,676.70 crore allocated, 26.50% higher than 2024-25.
• Rs 5,000 crore for new aircraft, vessels, and patrol boats.

Strengthening Border Infrastructure

• Rs 7,146.50 crore allocated to BRO, up 9.74%.
• Projects in Arunachal Pradesh, J&K, and Rajasthan to boost security and economy.

Defence Budget 2025: Summary of The News

Aspects	Details
Why in News?	Union Budget 2025-26 allocates Rs 6,81,210.27 crore for MoD, a 9.53% increase, making it the highest among ministries.
Capital Outlay	Rs 1,80,000 crore (26.43%) for modernisation and infrastructure.
Revenue Expenditure	Rs 3,11,732.30 crore (45.76%) for pay, allowances, and operational needs.
Defence Pension	Rs 1,60,795 crore (23.60%) for 34 lakh pensioners.
Civil Organisations	Rs 28,682.97 crore (4.21%).
Modernisation & Procurement	Rs 1,48,722.80 crore for aircraft, submarines, AI-driven tech, drones, cyber warfare, and domestic defence manufacturing (75% domestic procurement).
Operational & Sustenance	Rs 3,11,732.30 crore (10.24% higher), including Rs 1,97,317.30 crore for salaries and 24.25% rise in operational funds.
DRDO & R&D	Rs 26,816.82 crore (+12.41%), Rs 14,923.82 crore for AI, robotics, space tech.
Startups & Innovation	Rs 449.62 crore for iDEX & ADITI schemes, tripled in two years.
Ex-Servicemen Welfare	Rs 1,61,000 crore for pensions (+13.87%), Rs 8,317 crore for ECHS (+19.38%).
Indian Coast Guard	Rs 9,676.70 crore (+26.50%), Rs 5,000 crore for new aircraft, vessels, patrol boats.
Border Infrastructure	Rs 7,146.50 crore (+9.74%) for projects in Arunachal Pradesh, J&K, Rajasthan.
Conclusion	Focus on modernisation, self-reliance, AI, R&D, domestic procurement, and defence innovation to boost national security and economy.