Pension finances lowered: Rs 4.78 lakh crore allotted for defence, capital outlay up 19%


The capital outlay for the armed forces was elevated by nearly 19 per cent and a complete of Rs 4.78 lakh crore was allotted for the defence Budget for 2021-22 as in opposition to Rs 4.71 lakh crore final yr.

In 2020-21, the capital expenditure of the Army, Navy and Air Force was nearly Rs 23,500 crore greater than what was allotted within the finances estimates final yr.

Defence Minister Rajnath Singh thanked the Prime Minister and Finance Minister on Twitter “for increasing the defence budget to 4.78 lakh cr for FY21-22 which includes capital expenditure worth Rs 1.35 lakh crore. It is nearly 19 percent increase in Defence capital expenditure. This is highest ever increase in capital outlay for defence in 15yrs.” He added, “I am glad that the Budget has proposed opening of 100 new Sainik Schools in the country.”

Excluding the pension invoice, the defence Budget stands at Rs 3.62 lakh crore this yr.

The capital outlay for the forces is Rs 1.35 lakh crore – 18.75 per cent greater than Rs 1.14 lakh crore that was initially budgeted. But the precise improve shouldn’t be as important. The revised estimates of the capital expenditure of the armed forces is Rs 1,34,510 crore. The new Budget estimate for the capital outlay is thus simply Rs 550.72 crore extra, or 0.Four per cent over the revised estimates of 2020-21. This means that going by the prices incurred final yr, the federal government is anticipating greater capital expenditure, contemplating the present situation and for modernisation of forces.

Even as the upper capital expenditure comes amid Army’s unprecedented deployment by the winter within the harsh terrains of japanese Ladakh, it’s the Navy and Air Force that spent extra over their budgeted outlay.

While the Army had a budgeted outlay of Rs 32,392.38 crore and revised estimates stand at Rs 33,213.28 crore — a rise of two.5 per cent — it has been given Rs 36,481.90 crore this yr. The Navy’s revised estimates stand at Rs 37,542.88 crore, which is 41 per cent over its budgeted allocation of Rs 26,688.28 crore. It has been given Rs 33,253.55 crore for 2021-22. For the Air Force, capital expenditure went up from Rs 43,281.91 crore in finances estimates to Rs 55,055.41 crore in revised estimates, going up by 27.2 per cent. This yr the Air Force has acquired Rs 53,214.77 in capital outlay.

While the Army has seen a rise over the revised capital prices it incurred, the allocation for Air Force and Navy within the finances estimates this yr is lower than their revised estimates from final yr.

The pension finances, which is nearly a fourth of the full defence Budget this yr, has come down in comparison with earlier years. Last yr, whereas the federal government put aside Rs 1,33,825 crore for defence pensions in its Budget, in revised estimates it stands at Rs 1,25,000 crore. The allocation for 2021-22 is even decrease at Rs 1,15,850 crore.

Defence Ministry officers talked about that the pension invoice was inflated final yr as there have been arrears of about Rs 18,000 crore. Decreasing the defence pension invoice has been one of many main challenges for the federal government and the armed forces.

Among different heads, the income expenditure for defence has gone up from Rs 2.09 lakh crore final yr to Rs 2.12 lakh crore this yr.

The civil expenditure for defence, which incorporates funding in Defence Public Sector Units (DPSU), public works, canteen shops and roads constructed by the Border Roads Organisation, amongst others, for this yr is over Rs 36,138.36 crore.