Defence budget under capital head fully utilised in FY2025-26

NEW DELHI: The defence ministry has fully utilised its capital outlay of Rs 1.86 lakh crore (revised estimate) for FY2025-26. In FY2024-25 too, the ministry had utilised its capital budget fully. The overall use of the defence budget, including MoD (civil) and pension, during FY2025-26 stood at 99.62 per cent.

The original appropriation for capital expenditure in the fiscal was Rs 1.8 lakh crore, which was raised by finance ministry in view of the pace of expenditure achieved by defence ministry during the first two quarters and given the increased requirement of forces for modernisation and other purposes post-Op Sindoor, a ministry’s release said.




A significant portion of the expenditure was towards acquisition of aircraft and aero engines, followed by land systems, electronic warfare equipment, armaments, shipbuilding, aviation stores and projectiles. Also included were proposals for acquisition of multi-role fighter aircraft, medium-altitude long-endurance remotely piloted aircraft for IAF, mine counter measure vessels for Navy, and quick-reaction surface-to-air missile system and Nag missile system Mark-2 for Army.

In financial year 2025-26, acceptance of necessity for 109 proposals amounting to Rs 6.81 lakh crore was accorded by defence ministry, compared to 56 proposals worth Rs 1.76 lakh crore approved in FY2024-25. Also, capital procurement contracts for a total of 503 proposals amounting to Rs 2.28 lakh crore were signed by the ministry in FY2025-26.

With a hike of 22%, the budget has allocated Rs 2.19 lakh crore under capital head for FY2026-27.
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