The government has raised its defence budget by 11.59 per cent to Rs 164,415 crore for 2011-12 from Rs 147,344 crore in 2010-11. However, the most remarkable feature of this year’s (2010-11) defence budget was that not only was the actual expenditure on purchase of equipment, or the capital outlay, exhausted, the three services also spent more than they had been allotted.
The government has pegged the capital outlay for 2011-12 at Rs 69,199 crore. In 2010-11, the budget estimate was Rs 60,000 crore, which was later revised upwards to Rs 60,833 crore.
Despite the three services spending the whole capital outlay for this financial year, for 2011-12, they have got only Rs 8,366 crore more than 2010-11 revised estimates. Earlier, several thousand crore rupees used to be returned to the central kitty every year because they could not be spent within time.
There is also a sharp rise in the allocation for aircraft and aero-engines at Rs 27,322 crore, compared to Rs 19,952 crore in the previous year, probably to purchase the 126 combat aircraft for which trials have been completed.
The revenue component of the defence budget, salaries, has been increased by Rs 5,200 crore. The government has set a revenue outlay of Rs 95,216 crore, compared to Rs 90,748 crore last year.