6. Defence Budget 2026: Process Reforms Needed

Background Union Budget 2026 significantly enhanced defence spending, reflecting India’s evolving strategic and security challenges. Key Highlights • Defence allocation rose to ~2% of GDP, registering double-digit growth. • Capital expenditure increased by over 22%, prioritising modernisation. • 75% of defence procurement reserved for domestic industry under Atmanirbhar Bharat. • Persistent delays in major acquisition projects (fighters, submarines, artillery). • Renewed demand for a non-lapsable Defence Modernisation Fund. Value Addition • Fragmented R&D spending limits innovation and technology absorption. • Procedural rigidity in procurement offsets the benefits of higher allocations. • China-Pakistan collusive threat demands time-bound capability building, not just spending. Key Definition • Capital Expenditure: Spending on long-term assets such as weapons, platforms, and infrastructure. Constitutional & Legal Provisions • Article 246: Defence falls under the Union List (Seventh Schedule). Conclusion Enhanced defence spending must be complemented by procurement reforms, indigenisation depth, and faster decision-making. UPSC Relevance • GS-3: Defence preparedness, internal and external security