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Post ‘Operation Sindoor’ Push Drives Surge in Defence Spending and Modernization
Anytime News Network | Pooja Srivastava
The Ministry of Defence has fully utilized its capital budget of ₹1.86 lakh crore for FY 2025–26, marking a significant milestone. While the government highlights this as an achievement, analysts view it as a reflection of rising defence demands and sustained military expansion.
The overall utilization stood at 99.62% of the total defence budget. Initially allocated ₹1.80 lakh crore, the capital outlay was later enhanced to ₹1.86 lakh crore, particularly in the aftermath of Operation Sindoor, which necessitated accelerated modernization efforts.
A major portion of the expenditure went towards aircraft and aero engines, followed by investments in land systems, electronic warfare equipment, weapons, shipbuilding, and missile systems. The government asserts that such spending will not only strengthen military capabilities but also boost infrastructure in border areas and contribute to economic growth through multiplier effects.
However, concerns are being raised over the rapid escalation in defence spending. In FY 2025–26, approvals were granted for 109 procurement proposals worth ₹6.81 lakh crore, a sharp increase compared to the previous year. Additionally, 503 capital acquisition contracts worth ₹2.28 lakh crore were signed.
Experts caution that while modernization is essential, such a steep rise in defence expenditure could strain fiscal balance and potentially impact allocations to other critical sectors.
For FY 2026–27, the government has further increased the capital allocation by 22% to ₹2.19 lakh crore, indicating that the upward trajectory in defence spending is likely to continue.
