Union Budget 2023: Defence spending increased by 13% to Rs. 5.94 lakh crore; more funds for spares, ammunition, border infrastructure

While the modernisation funds saw a meagre hike of 6.57 per cent at Rs 1.62 lakh crore, the revenue budget—including the pay and allowances of defence personnel—saw an increase of around 17.39 per cent.

This also includes allocations worth Rs 4266 crore towards the Agnipath scheme for the first time. The scheme was announced last year and the first batch of Agniveers across the three services are undergoing training at present.

The major hike in the revenue budget went to components such as stores, transportation, and works which is used for expenditure towards the maintenance of weapons systems, platforms, and equipment with the Armed Forces through procurement of critical spares and ammunition to maintain the optimal levels of operational preparedness.

In the modernisation budget for the Armed Forces, the Indian Air Force (IAF) got the highest allocation among the three services at Rs 0.57 lakh crore, which was, however, a mere 3.6 per cent hike from the financial year 2022-23.

While the Indian Army was allocated Rs 0.37 lakh crore—a hike of 15.6 per cent from the previous fiscal’s budgetary allocations, the Indian Navy was allocated a capital budget of Rs 0.52 lakh crore, up by 10.6 per cent from the previous financial year.

The defence pensions saw a major hike at Rs 1.38 lakh crore—up by 16 per cent from Rs 1.19 lakh crore in 2022-23—considering the increased pensions with the revision of the One Rank One Pension (OROP) scheme and the arrears worth Rs 23638 crore from 2019 to 2022.

With a push on developing border infrastructure, Rs 5000 crore was allocated for border infrastructure projects, up from Rs 3500 crore in the previous fiscal.

The seven defence public sector undertakings were allocated Rs 1310 crore and the Indian Coast Guard’s budget has been cut to Rs 7197 crore for 2023-34 from Rs 7310 crore.