India to spend 75% of defence capital on procurement from local industries: Rajnath Singh

The overall Defence budget earmarked for 2023-24 is Rs 5.94 lakh crore, including pensions of Rs 1.38 lakh crore, up by 12.9 per cent from Rs 5.25 lakh crore allocated in the previous (2022-23) fiscal. This is 13.18 per cent of the total Budget outlay of Rs 45,03,097 crore.

Of this, the capital outlay has been earmarked at Rs1.63 lakh crore.

In 2021-22, the Defence Ministry had earmarked 64 per cent of its budget towards procurements from indigenous sources.

But, with a large number of indigenous procurements towards the end of the financial year, the government exceeded the 64 per cent target and spent 68 per cent of the budget on domestic procurements.

The ministry subsequently in 2022-23 earmarked 68 per cent of its capital outlay for indigenous sources.

It is immediately not known what percentage of this target has been spent on domestic procurements so far.

Calling the decision an “unprecedented step” to strengthen the indigenous defence industry and minimise import dependency, the Defence Minister said: “If you take one step, the government promises to take 10 steps forward.”

“You spoke of land to run on the path of development. We are providing you full sky. Earmarking three-fourth of the capital procurement budget for the local industry is a step in that direction,” he said.

He said the Indian industry will come forward with more enthusiasm and contribute in making the defence sector more powerful and prosperous with this step.

Some of the major MoUs signed during the event include one between the Hindustan Aeronautics Limited (HAL) and Safran Helicopter Engines, France for Work Share for formation of Joint venture for Design, Development, Manufacture and life time support of Helicopter Engines and another pacts between Bharat Electronics Ltd and Aeronautical Development Agency on IWBC and Other LRUs for Advanced Medium Combat Aircraft (AMCA) and between HAL and Elta Systems Limited, Israel for cooperation on future Business in Maritime Patrol Radar (MPR) for Indian platforms, among others.

Singh said the MoUs and transfer of technologies completed during this ceremony will pave the way for enhanced FDI in defence and boost defence manufacturing in the sector to greater heights. He added that the partnerships forged with friendly countries will take their bilateral collaboration with India to the next level.

He also described Karnataka as one of those historical states which has been consistently contributing to the country’s economic progress, adding that there could not be a better place than Karnataka to organise Aero India as the state has attracted local as well as international industries with its robust R&D manufacturing ecosystem.