New Delhi: According to the analysis of the demand for the grant 2025-26 by PRS Legislative Research published last month, the funds given to the Ministry of Defense (MOD) rejected both as part of the budget and GDP of the Center. This is the largest of the ministries at 13 percent of the total expenditure of the government, despite its allocation in the Union Budget.
Apart from allocation to three defense services, the annual defense budget also includes research and development (R&D) and expenditure on border roads. This includes the cost of armed forces personnel and citizens, pension, modernization efforts, production installations and salaries of R&D.
In the financial year (financial year) 2025-26, the Center allocated Rs 6,81,210 crore towards the mod.
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Comparing the budget of the previous year, the report said, “In 2014-15, the Center spent 17 percent of its total budget on defense, which decreased by 13 percent as per the budget estimates of 2025-26.”
As Analysis by PRSBetween 2013-14 and 2025-26, the total central government’s expenditure increased at an annual rate of 10 percent, compared to an annual increase of 9 percent in defense spending.
Given that the funds allocated to the armed forces under the Revenue and Capital Head were 20 percent lower than their estimated needs between FY 2015-16 and FY 2024-25, PRS reported that the allocation for the armed forces is based on the estimates presented by them during the budget making phase.
While the revenue budget refers to recurring expenses such as salary and pension, which are day-to-day expenses, capital budget refers to long-term investment like weapons and equipment in defense sector.
According to the report, the funds allocated to the armed forces between 2015-16 and 2024-25 were 20 percent less than their estimated needs. Comparatively, in the past, the decrease for the capital budget was higher than the revenue budget.
This was not correct for 2023–24 and 2024–25, when the capital was in line with budget estimates.
The report further observed that the share of budgetary expenditure of the MOD spent on the capital outlay has declined. While it was 32 percent in 2013-2014 and was less than 30 percent between 2014-15 and 2024-25, it is estimated to spend 28 percent in 2025-2026.
In contrast, in terms of revenue budget, the defense pension increased at an annual rate of 11 percent between 2013-2014 and 2025-2026. The PRS report states, “This is higher than the annual increase in total defense expenditure at 9 percent.”
As a result, the report states, “A large part of the defense budget has been spent on pension”. For 2025-2026, it is estimated that 24 percent of the total budget will be spent on pension.
(Edited by Sanya Mathur)
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