India hikes defence budget by 15%
The allocation marks a sharp rise from Rs 6.81 lakh crore in the 2025–26 financial year.
India has increased its defence budget by 15% to Rs 7.84 lakh crore for the 2026–27 financial year, as the country plans major procurement programmes, including contracts for Rafale fighter jets, submarines and unmanned aerial vehicles.
The allocation marks a sharp rise from Rs 6.81 lakh crore in the 2025–26 financial year.
Of the total outlay, the armed forces will receive Rs 2.19 lakh crore for modernisation under the capital budget, reflecting a 21.84% increase from Rs 1.80 lakh crore in the previous fiscal year.
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Under capital expenditure, Rs 63,733 crore has been earmarked for aircraft and aero engines, while Rs 25,023 crore has been allocated for strengthening the naval fleet.
In another boost to the defence sector, Finance Minister Nirmala Sitharaman, while presenting the budget in parliament, announced an exemption of basic customs duty on imported raw materials used in manufacturing aircraft parts for maintenance, repair and overhaul activities in defence units.
