The upcoming Union Budget 2025 is highly anticipated in the defence sector, with expectations of significant boosts to indigenous manufacturing and public-private partnerships aimed at enhancing India's self-reliance in defence capabilities. Here are the key highlights and predictions regarding the budget:

Experts predict that the allocation for the Ministry of Defence may see a rise, with expectations of capital expenditure reaching approximately ₹1.9 lakh crore. This is part of a broader strategy to enhance local manufacturing and reduce reliance on imports.

A substantial portion of the defence budget, estimated at 75%, is earmarked for domestic purchases, promoting local industries and strategic autonomy. This aligns with the government's ongoing efforts to bolster indigenous capabilities in defence production.

Modernisation Initiatives

The budget is expected to prioritize modernising military vehicles, upgrading the Indian Air Force's equipment, and enhancing the Indian Navy's fleet. This modernization is crucial for addressing external threats, particularly from neighbouring countries like China and Pakistan.

Support for Emerging Industries: There is a strong push anticipated for sectors such as drone manufacturing, with plans for increased R&D funding and regulatory simplifications to foster growth in this area.

Public-Private Partnerships

The government aims to empower private companies through partnerships that can facilitate technology transfer and innovation. This collaboration is seen as essential for achieving strategic goals in defence production.

While there are optimistic projections, concerns remain regarding bureaucratic inefficiencies and the actual implementation of policies aimed at increasing indigenous content in defence products. Experts suggest that a more granular evaluation of indigenous content could enhance transparency and accountability.

Long-term Vision: The defence sector is looking towards a long-term vision where sustained investment in R&D and infrastructure will be crucial for establishing India as a competitive player in global arms markets. The government’s focus on creating export-oriented special economic zones (SEZs) for defence production could further enhance this goal.

The Defence Budget 2025 is poised to significantly impact India's indigenous industries by increasing allocations for local manufacturing, emphasizing modernisation of forces, and fostering public-private partnerships. However, successful implementation will require addressing existing bureaucratic challenges and ensuring effective utilization of funds.

IT News