Budget 2022: Overall Defence Budget hiked by 10 pc

New Delhi: The government has increased India's overall defence budget by nearly 10 per cent from 4.78 lakh crore last year to Rs 5.25 lakh crore this year. The capital outlay for defence has been increased from Rs 1.35 lakh crore last year to Rs 1.52 lakh crore this year.

Presenting the Union Budget 2022-23 in the Lok Sabha, Finance Minister Nirmala Sitharaman said the government is committed to promote Aatmanirbhar Bharat and reduce dependence on imports of defence equipment.

The government has earmarked 68 per cent of defence capital procurement budget for domestic industry in 2022-23 which is up from the 58 per cent in last fiscal year.

"Sixty-eight per cent of the capital procurement budget will be earmarked for domestic industry in 2022-23, up from 58 per cent in 2021-22," said Sitharaman.

In another big step, Sitharaman announced that 25 per cent of defence Research and Development budget has been earmarked for private industry, startups and academia whilst adding that an umbrella body will be set up for certification of defence equipment.

She said that private players to be encouraged to take up the design and development of military platforms in collaboration with the Defence Research and Development Organisation (DRDO).

Congratulating Sitharaman for the "people friendly and progressive budget", Prime Minister Narendra Modi has said that India's MSME sector will get a big benefit from the decision to keep 68 per cent of the capital procurement budget for domestic industry in 2022-23

The Prime Minister said this budget has brought a new confidence of development and it will strengthen the economy as well as create many new opportunities for the common man.

Defence Minister Rajnath Singh took to Twitter and said that the 68 per cent of defence capital procurement budget allocated towards local procurement is in line with the 'Vocal for Local' push and it will certainly boost the domestic defence industries.

"Substantial amounts have been allocated towards Research and Development in several sectors including Defence. The proposal to reserve 25 per cent of the R&D Budget for Startups and Private entities is an excellent move," the Minister tweeted.

The Society of Indian Defence Manufacturers welcomed the announcements by Sitharaman. "SIDM welcomes announcement of setting aside 68 per cent of capital outlay of defence budget for domestic industries, up from 58 per cent in the previous year. This will sustain investments and attract fresh capacity creation," SIDM President S P Shukla said.

This will lead to both investment and job creation. Shukla said that creation of a nodal body for setting up the Testing and Certification requirements of defence systems and platforms will help domestic industry through faster processes and cost efficiency. (UNI)