The Narendra Modi government is all set to greenlight the acquisition of 26 Rafale-Maritime strike fighters this month, continuing the trend of increased capital spending on defence equipment. In 2024-25, the NDA government spent in excess of ₹2 lakh crore on this.
HT learns that the $7.6 billion fighter jet deal is all set to go before the Cabinet Committee on Security (CCS) later this month and will be followed by government approval for three additional diesel electric submarines after all the stakeholders are brought on the same page. The Rafale-M fighters will be used to give more teeth to the Indian Navy at sea onboard India’s two aircraft carriers, while the additional submarines will strengthen conventional deterrence in the Indian Ocean Region (IOR).
The defence ministry signed 193 contracts in 2024-2025 with an outlay of ₹209059.85 crore as compared to 192 contracts worth ₹104855.92 crore in 2023-2024. Since the Narendra Modi government took office in 2014, the ministry has signed 1096 contracts worth nearly ₹10 ( ₹946225.48) lakh crore.
The numbers showed that that capital expenditure touched a peak in 2024-2025 with no surrender of any funds as compared to the previous four years. In 2020-2021, the ministry surrendered funds of ₹205 crore, in 2021-2022, ₹863 and in 2022-2023, ₹7055.99 crore. Even in 2023-24, the ministry surrendered ₹2971.97 crore. Simply put, while the Modi government was allocating significant funds for capital outlay, the defence ministry could not spend the amount, leading to lower revised estimates.
With India’s neighbours, particularly China upgrading border infrastructure all along the 3488 km LAC (line of actual control) and countries in the Indian sub-continent showing signs of serious political and financial stress, the Modi government has decided to give top priority to military capacity building with focus on ‘Aatmanirbhar Bharat.’
It is understood that top officials have been given the task of project management and accountability for indigenous capacity building by making Defence PSUs such as HAL and BEL more answerable and timeline-conscious. DRDO has also been told firmly that the nation cannot wait for never ending testing of hardware platforms given that the global instability is going to be the norm in the near future.
