Budget 2025: Finance Minister Nirmala Sitharaman is scheduled to present her eighth Union Budget on February 1, 2025. This will be the second budget of Prime Minister Narendra Modi’s third term, and industry leaders expect a special focus on the defence sector. Experts believe that there will be a further push towards the rise in the allocation this year.
In the financial year 2024-25, the government allocated Rs 6.22 lakh crore to defence, reflecting a 4.79 per cent increase from the previous year, in line with its ongoing emphasis on modernisation and self-reliance.
Push Towards Public-Private Partnerships
Jaikaran Chandock, Director, Balu Forge Industries said that defence will be one of the key focus areas for the upcoming Union Budget 2025, as the government is intensifying its efforts to achieve self-reliance in the design, development and manufacturing of defence equipment.
“The budget should propose an increase in the capital outlay for the defence sector to bolster capacity and capability, driving progress towards achieving self-reliance and attaining the defence exports target of Rs 50,000 crore by 2029. With a dynamic defence manufacturing sector, India can boost indigenisation as well as domestic procurement of defence products and can become a global hub for sourcing advanced defence equipment. Therefore, the budget needs to propose measures and schemes that encourage technology transfer, public-private partnerships, R&D and collaboration with global players and Original Equipment Manufacturers (OEMs). A strong defence manufacturing ecosystem will help the sector unlock emerging opportunities,” he opined.
Increase In Exports
Leaders expect governments full impetus to the defence sector this year as well. Ram Aggarwal, CEO of Goodluck India, said, “The government has been giving full impetus to the defence sector. The aim is not only to fulfil India’s demand but also to increase exports, while Indianisation and offset conditions for any domestic demand will boost private participation. India’s defence players want to cut in delays in finalisation of projects and more fund allocation for this rising sector. Also, the government’s thrust on self-reliance in the defence sector will give a fillip to the industry.”
Increased Funding For R&D
Major General (Dr) Mandip Singh, SM, VSM (Retd) President Strategic Alliances at DroneAcharya Aerial Innovations highlighted that it is imperative that the government acknowledge the transformative potential of the drone industry, especially in the defence sector.
“The induction of commercial drones to perform a variety of defence-oriented tasks has highlighted the critical need for dual-use technologies, particularly in the drone sector. In fact, the drone ecosystem is emerging as a critical component of national power & could be a major driver of the Indian export market. The government’s support through favourable policies, increased funding for R&D, and incentives for domestic manufacturing can become the fuel to propel this engine of growth & export,” he said.
He added that to truly harness the potential of drones, the upcoming budget should emphasise the ‘Make in India’ initiative, encouraging indigenous production of advanced drone technologies.
“Further, establishing dedicated drone corridors & drone parks and enhancing the ease of doing business for drone startups can catalyze sectoral growth. With the right fiscal measures, we can envision India becoming a global hub for drone technology, fostering innovation that meets both civilian and defence needs. We at DroneAcharya Aerial Innovations are committed to contributing to this growth and stand ready to collaborate with the government in advancing India’s drone ecosystem, ensuring our nation becomes the world leader in this transformational technology revolution,” he opined.
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