India's Defence Budget Rises by 15%: What Does it Mean for Indian Military?
© AP Photo / Mukhtar Khan
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In the Federal Budget announced on Sunday, India hiked its defence budget by nearly 15% to a record $85 billion, rising from $74.3 billion in FY26.
As the first post – Operation Sindoor defence budget, FY26 provides a major boost to the sector, earmarking 14.67% of overall Central Government expenditure for defence and making the ministry the single largest recipient of funding, experts have said.
Dr Thomas Mathew, a former Joint Secretary in India's Ministry of Defence (MoD) and the man who drafted India's defence offset policy, felt that the increase in the country's defence budget wasn't "dramatic" and rather it was a "beginning", considering the threats posed to the nation's security by its neighbours.
"India should have a budget that should be at least about 5% of the country's GDP. The main reason behind it is that India needs to prepare itself to counter its declared enemies. One must not forget that India wants good neighbourly relations with all its neighbours, but some of its neighbours are inimical to its security and sovereignty," Mathew told Sputnik India.
The capital acquisition budget has also surged by 21.8% compared to FY25, and a significant share of this expanded outlay is earmarked for financing the Indian Air Force's (IAF) modernisation initiatives.
"Key programmes such as Mission Sudarshan Chakra — a multi-layered Integrated Air Defence System (IADS) — are expected to be prioritised, including development of new long-range interceptors and refined specifications to better counter low-observable targets and swarm drones, in light of feedback from Operation Sindoor," Abhijit Apsingikar, a senior analyst at defence market intelligence firm GlobalData, said in an interview with Sputnik India.
The Air Force is a major beneficiary of the expanded capital outlay, and key acquisition programs — such as procurement of 114 Multi-Role Fighter Aircraft (MRFA), a new Medium Transport Aircraft (MTA), long-range air-to-air missiles, Medium Altitude Long Endurance (MALE) Unmanned Aerial Vehicles (UAVs), and High-Altitude Long Endurance (HALE) UAVs — are likely to be approved on a priority basis, he added.
In addition, the long-pending Indian Navy deal for new submarines under Project-75 is nearing fruition, with a contract for six new conventional submarines likely to be signed in the first half of 2026, the military pundit asserted.
In addition, the long-pending Indian Navy deal for new submarines under Project-75 is nearing fruition, with a contract for six new conventional submarines likely to be signed in the first half of 2026, the military pundit asserted.
"Other big-ticket acquisitions that may be accelerated include the development and procurement of Unmanned Ground Vehicles, alternative navigation technologies for GPS-denied environments, autonomous Unmanned Surface Vessels (USVs) and Unmanned Underwater Vehicles (UUVs), long-range loitering munitions, long-range tactical rockets and missile systems, and minesweepers," Apsingikar underscored.
Following the conceptual success and operationalisation of the previously experimental Bhairav Battalion — a dedicated light-commando unit specialising in drone deployment and electronic warfare in contested hybrid battlefields — focus is expected to shift towards organically integrating First Person View (FPV) remotely piloted drones, small tactical UAVs, and loitering munitions within the Army's command structure, with even small squads capable of deploying them, he explained.
Specialised unmanned logistics vehicles and scout robots are also likely to be developed to support Indian Army formations in operations, the defence observer noted.
The Navy, too, is expected to procure additional weaponised USVs and UUVs and deploy them for patrolling, as well as for pre-emptive tracking and interception of inbound threats, Apsingikar reckoned.
Given that weapons development is based on certain assumptions about an adversary's capabilities, the outcomes of Operation Sindoor were indeed a factor influencing procurement priorities. While the performance of Indian forces was viewed as satisfactory during Operation Sindoor, the conflict nonetheless exposed a few critical capability gaps, he highlighted.
Specialised unmanned logistics vehicles and scout robots are also likely to be developed to support Indian Army formations in operations, the defence observer noted.
The Navy, too, is expected to procure additional weaponised USVs and UUVs and deploy them for patrolling, as well as for pre-emptive tracking and interception of inbound threats, Apsingikar reckoned.
Given that weapons development is based on certain assumptions about an adversary's capabilities, the outcomes of Operation Sindoor were indeed a factor influencing procurement priorities. While the performance of Indian forces was viewed as satisfactory during Operation Sindoor, the conflict nonetheless exposed a few critical capability gaps, he highlighted.
"For instance, the operation highlighted the erosion of India's technological edge in long-range air-to-air missiles and underscored the need to extend the range of the in-production Astra Mk1 air-to-air missile, as well as the Astra Mk2 and Astra Mk3 missiles that are still under development. Astra Mk1's range is expected to increase to 160 km from the current 110 km, while Astra Mk2 is anticipated to be upgraded to an extended engagement envelope of 240 km, and Astra Mk3 to an envelope of 350 km," the strategic affairs specialist emphasised.
Similarly, feedback from Operation Sindoor has underscored the need to develop stand-off precision strike capabilities. As a result, projects such as the turbojet-powered SAAW missile, PULS MLRS, Pinaka guided extended-range rockets, the Pralay tactical ballistic missile, the Medium Range Anti-Ship Missile (MRAShM), and the Long-Range Anti-Ship Missile (LRAShM) are likely to be prioritised, Apsingikar pointed out.
Besides, Operation Sindoor highlighted the need for dedicated electronic warfare capabilities and ground-based close-in weapon systems (CIWS). Thus, specialised Electronic Warfare aircraft are likely to be acquired and some ageing platforms, such as the ZSU-23-4 'Shilka', and obsolete L70 Bofors guns are expected to be replaced by modern rapid-firing gun systems for CIWS duties to improve interception probability, he underlined.
Besides, Operation Sindoor highlighted the need for dedicated electronic warfare capabilities and ground-based close-in weapon systems (CIWS). Thus, specialised Electronic Warfare aircraft are likely to be acquired and some ageing platforms, such as the ZSU-23-4 'Shilka', and obsolete L70 Bofors guns are expected to be replaced by modern rapid-firing gun systems for CIWS duties to improve interception probability, he underlined.
