New Delhi: Finance Minister P Chidambaram on Tuesday proposed a hike in the defence budget for 2007-08 to Rs 96,000 crore, an increase of 7.8 per cent over the current fiscal's outlay.
The increase was Rs 10,000 crore more in actual terms, as the defence ministry spent Rs 86,000 crore as against its outlay of Rs 89,000 crore for 2006-07.
Chidambaram said that the allocation of Rs 96,000 crore would include a whopping Rs 41,922 crore for capital expenditure or acquisition of new hardware, signaling that the armed forces would go ahead with some big ticket weapons deals.
He also promised to provide more funds to the defence ministry if the need arose. "Needless to say, any additional requirement for the security of the nation will be provided," he said.
Defence Minister A K Antony said the continued hike in defence expenditure signaled the UPA Government's "resolve to go full steam ahead with the modernisation" of the military. "I am satisfied with the commitment of providing extra funds made by the finance minister," he said.
Antony, however, said there had been some laxity in certain fields during the modernisation drive, and efforts would now focus on ensuring the upgradation of the arsenal of all three services.
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