The Union Budget for Financial Year 2023-24 envisages a
total outlay of Rs 45,03,097 crore. Of this, Ministry of Defence has been
allocated a total Budget of Rs 5,93,537.64 crore, which is 13.18 % of the total
budget. This includes an amount of Rs 1,38,205 crore for Defence Pensions. The
total Defence Budget represents an enhancement of Rs 68,371.49 crore (13%) over
the Budget of 2022-23.
In
keeping with the Government’s resolve and focus towards maintaining a high
level of Operational Preparedness of the Defence Services to face current and
future challenges, the Non-Salary Revenue/operational allocation gets a boost
of Rs 27,570 Crore, with the budgetary outlay under this segment augmented from
Rs 62,431 crore in BE 2022-23 to Rs 90,000 crore in BE 2023-24. This will cater
to sustenance of Weapon Systems, Platforms including Ships/Aircraft and their
logistics; boost fleet serviceability; emergency procurement of critical ammunition
and spares; procuring/hiring of niche capabilities to mitigate capability gaps
wherever required; progress stocking of military reserves, strengthening
forward defences, amongst others.
As
a precursor to this increase in the Non-Salary Revenue segment, the government
during the Mid-term review had also enhanced the operational allotments of the
current financial year by Rs 26,000 crore, which works out as 42% of the
present allocation. This unprecedented increase in the Revised Estimates
2022-23 has ensured liquidation of the entire carry over liabilities during the
current year thereby ensuring that there is no dent in the next year’s
operational outlay of the Services.
In
the Union Budget 2023-24, the Capital Investment Outlay has been increased
steeply for the third year in a row by 33 per cent to Rs 10 lakh crore, which
would be 3.3 per cent of GDP. This will be almost three times the outlay in
2019-20.
Accordingly, the Capital Allocations pertaining to
modernisation and infrastructure development of the Defence Services has been
increased to Rs 1,62,600 crore representing a rise of Rs 10,230 crore (6.7%)
over FY 2022-23. Also, the increase in the Capital Budget since 2019-20 has
been Rs 59,200 crore (57%). This increase is a reflection of the Government’s
commitment towards sustainable augmentation in the area of modernisation and
infrastructure development of the Defence Services.
Accordingly,
the Capital Budget of Border Roads Organisation (BRO) has been increased by 43%
to Rs 5,000 crore in FY 2023-24 as against Rs 3,500 crore in FY 2022-23. Also,
the allocation under this segment has doubled in two years since FY 2021-22.
This will boost the Border infrastructure thereby creating strategically
important assets like Sela Tunnel, Nechipu Tunnel and Sela-Chhabrela Tunnel and
will also enhance border connectivity.
Towards
strengthening Research and Development in Defence, the allocation to DRDO has
been enhanced by 9%, with a total allocation of Rs 23,264 crore in BE 2023-24.
To
further foster innovation, encourage technology development and strengthen the
Defence Industrial ecosystem in the country, iDEX and DTIS have been allocated
Rs 116 crore and Rs 45 crore respectively representing an enhancement of 93%
for iDEX and 95% for DTIS over 2022-23. This will fulfill the Ministry of
Defence’s vision to leverage ideas from bright young minds across the country.
The
Union Budget 2023-24 has announced a National Data Governance Policy to unleash
innovation and research by start-ups and academia. This will enable access to
anonymized data which will further boost the Defence Start-ups and iDEX scheme.
The
Union Budget 2023-24 has also announced that the revamped Credit Guarantee
scheme for MSMEs which will take effect from 1st April 2023 through infusion of
Rs. 9,000 Crore in the corpus. This will enable additional collateral-free
guaranteed credit of Rs 2 lakh crore. Further, the cost of the credit has also
been reduced by about 1 per cent. This scheme will give a further fillip the
MSMEs associated with the Defence Sector.
The
Defence Pension Budget registers a notable jump of 15.5 % in FY 2023-24. In
absolute terms, this amount is Rs 1,38, 205 Crore in BE 2023-24 against Rs
1,19,696 crore in BE 2022-23. Further, RE 2022-23 allocations at Rs 1,53,415
crore records a significant jump of 28%, amounting to Rs 33, 718 crores. This
includes an amount of Rs 28,138 Crore to meet the requirement on account of
revision of Armed Forces Pensioners/ Family Pensioners under One Rank One
Pension (OROP).
Towards
the Government’s commitment in transforming Healthcare outreach to our
veterans, Defence Budget 2023-24 registers a notable increase of 52% in the
allotment for Ex-Servicemen Contributory Health Scheme (ECHS) with BE
allocation of Rs. 5431.56 Crore in FY 2023-24 against Rs. 3582.51 Crore in FY
2022-23. This enhancement will ensure ‘Cashless Health Services’ and improved
‘Service Delivery’ to our veterans and their dependents across India.