The Ministry of Defence has fully utilised its capital outlay of 1.86 lakh crore rupees for Defence Services in the Financial Year 2025-26 at the revised estimates stage. Overall utilisation of the defence budget, including civil and pensions, stood at 99.62 percent.

 

The initial allocation of 1.80 lakh crore rupees was later increased due to higher spending and additional requirements after Operation Sindoor. The Ministry informed that major spending was on aircraft and aero engines, land systems, electronic warfare equipment, armaments and shipbuilding. During the year, Acceptance of Necessity was granted to 109 proposals worth 6.81 lakh crore rupees, compared to 56 proposals worth 1.76 lakh crore rupees in 2024-25. Contracts for 503 proposals worth 2.28 lakh crore rupees were signed.  The Ministry of Defence has been allocated 2.19 Lakh crore rupees for the financial year 2026-27, with 22 percent hike for defence modernisation.