India Reserves 75% Defence Modernisation Budget For Domestic Industry
India on February 15 announced a booster shot for the indigenisation agenda for military procurements, earmarking 75 per cent of its armed forces modernisation budget for 2023-24 for domestic industry. This translates into assured annual business of Rs 1,22,250 Crore for the domestic industry, increasing the Make in India proportion of the capital allocation for the armed forces for 2022-23 from 68 per cent.
India’s aggregate Defence Budget is 5,94,000 Crore, of which Rs 1,63,000 Crore is allocated under the Capital head.
This announcement was made by Defence Minister Rajnath Singh at the ‘Bandhan’ ceremony at India’s biggest air show, Aero India 2023, at Bengaluru. MoUs and agreements worth Rs 80,000 Crore were announced at the ceremony, which showcased the size and depth of India’s market for Defence equipment.
The Defence Minister said the decision was taken in continuation of the policy to minimise import dependency. “If you take one step, the Government promises to take ten steps forward. You spoke of land to run on the path of development. We are providing you full sky. Earmarking three-fourth of the capital procurement budget for the local industry is a step in that direction,” he told the gathering of Industry leaders at the ceremony.
Singh expressed confidence that this step would result in greater enthusiasm from Indian industry towards the Defence sector. A strong and self-reliant Defence industry not only strengthens the security system of the country but also bolsters the economy, he said.
The Defence Minister emphasised that the domestic industry-friendly environment provides a runway for the local companies to grow and ensure holistic development of the nation while catering to the security needs of the friendly countries, in line with Prime Minister Shri Narendra Modi’s vision of ‘Make in India, Make for the World’.
