₹6.81 lakh crore, or around $79 billion, was set up for defense in India’s most recent Union Budget for FY2025-26, a 9.53% increase over the previous fiscal year. With ₹1.8 lakh crore set aside expressly for new purchases, such as fighter jets, navy vessels, and cutting-edge missile systems, this budget places a strong emphasis on military modernization. Notably, this commitment amounts to 1.9% of India’s estimated 2024–2025 GDP, which is less than the 2.5% minimum that is advised in order to adequately handle strategic threats from Pakistan and China, two of its neighbors.
China: India’s defense budget is far smaller than China’s, which is estimated to be between $232 billion and $309 billion. Officially, China spends about 1.5% of its GDP on defense, but real spending may be greater because of large expenditures on military infrastructure and dual-use technology that are not completely included in the official budget. Expanding its naval capabilities and developing cutting-edge technology like hypersonic missiles and AI combat systems are the main goals of China’s military development.
The defense budget for India for FY2025–2026 is ₹6.81 lakh crore, or roughly $79 billion, up 9.53% from the year before, the fastest growth rate in recent memory. The goal of this increase is to improve defense production’s self-reliance and military modernization.
India’s defense budget has steadily increased over the past 10 years, with yearly increases frequently ranging from 7% to 13%. These increases, however, have not continuously kept up with China’s military budget’s explosive expansion or inflation.
While the actual amount may be greater due to unreported expenses, India’s defense spending has historically accounted for 1.9% to 2% of its GDP, which is higher than China’s official numbers of 1.5%.
China’s massive military expenditure still dwarfs India’s recent increases, despite the fact that they are noteworthy for their context. For instance, India’s budget in 2023–2024 was about $72 billion, whereas China’s was $225 billion. This illustrates a long-standing disparity that hasn’t decreased over time.
The discrepancy in defense spending raises questions about India’s capacity to successfully uphold deterrence against Pakistan and China. In order to improve its military capabilities in this competitive environment, India must maximize its resources and concentrate on domestic production even with growing allocations.
Pakistan’s defense spending for the same time period, however, is much smaller. This discrepancy demonstrates the enormous disparity in military spending between the two countries: Pakistan’s budget allocation is only $7.64 billion with 650,000 personnel, while India’s budget is $79 billion with 1.4 million personnel.
Compared to Pakistan, India has over 800,000 more active military personnel.
With 2,296 aircraft, India is ranked fourth in the world, whereas Pakistan has 1,434 aircraft.
India’s increased defense expenditures are a component of a larger plan to strengthen military capabilities in reaction to perceived threats from Pakistan and China. Under programs like Atmanirbhar Bharat, the emphasis on domestic defense manufacture seeks to improve scientific developments and operational readiness while lowering dependency on foreign weapons.
Even though India’s defense expenditure has increased significantly, it still shows a size difference with its regional competitors. Through programs like Aatmanirbhar Bharat, the funding is intended to improve border security and encourage independence in defense manufacturing. To lessen dependency on foreign arms imports, which now make up a sizable amount of India’s military capabilities, experts contend that the country must emphasize domestic manufacture and increase the efficiency of its military spending.
Although India’s latest budget increase shows a dedication to military modernization and readiness, it will be difficult to match China’s defense spending levels and the strategic challenges presented by both China and Pakistan.