Budget cuts to slow down defence modernisation plans

India’s economic woes are taking a toll on its military modernisation plans that attracted global arms manufacturers with estimations that Rs 5 lakh crore is the likely spend in defence purchases this decade.

But the budget cuts of nearly Rs 15,000 crore from last year’s `1.93 lakh crore, and the 5.3 per cent hike in the budget at Rs 2.03 lakh crore, may also affect the strengthening of defences in core sectors such as the North East.

With a capital outlay of Rs 86,741 crore, Finance Minister P Chidambaram has allocated `Rs 38,558 crore for new buys to the IAF, followed by the Army with Rs 17,822 crore, the Navy with Rs 9,626 crore, and DRDO with Rs 5,058 crore.

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