Budget 2021: Finance Minister Nirmala Sitharaman allocated Rs 4.78 lakh crore to the defence sector for the financial year 2021-22, as against the last year’s outlay of Rs 4.71 lakh crore. The Finance Minister termed it as the highest ever outlay for the sector in 15 years. The government increased the budget allocation for capital defence expenditure by 18.75 per cent over 2020- 2021. Out of the total allocation, Rs 1.35 lakh crore has been set aside for capital outlay for buying new weapons, aircraft, warships and other military hardware.
The capital outlay in the defence budget 2020-21 was Rs 1.13 lakh crore. The total revenue expenditure, which includes expenses on payment of salaries and maintenance of establishments, has been pegged at Rs 3.37 lakh crore. The total revenue expenditure included Rs 1.15 lakh crore for the payment of pensions.