Accelerating modernisation, India’s Defence Ministry has already spent over half its ₹1.8 trillion budget by September, fast-tracking aircraft, submarines, and weapon system deliveries.
The Ministry of Defence (MoD) has utilised more than half of its capital outlay for FY 2025-26 within the first six months of the financial year, according to recent data published by the government.
By the end of September 2025, the ministry had spent ₹922.11 billion, or 51.23% of its total allocation of ₹1.8 trillion. In the previous fiscal year, the MoD had achieved full utilisation of its capital expenditure, amounting to ₹1.60 trillion.
According to the ministry, the strong pace of spending is expected to ensure the timely delivery of critical defence platforms, including aircraft, ships, submarines, and advanced weapon systems, essential for modernising the Armed Forces.
The bulk of the expenditure so far has gone towards aircraft and aero engines, followed by land systems, electronic warfare equipment, armaments, and projectiles.
Furthermore, capital expenditure plays a pivotal role in strengthening national defence, as it supports the acquisition of cutting-edge technology, research and development, and infrastructure along India’s borders. It also contributes significantly to broader economic growth and job creation.
For FY 2025-26, the Ministry of Finance allocated ₹1.8 trillion under the capital head, marking a 12.66% increase over the actual expenditure in FY 2024-25. Of this, ₹1.12 trillion has been earmarked for procurement from domestic industries to promote self-reliance under the ‘Aatmanirbhar Bharat’ initiative.
So far, 45% of the funds earmarked for domestic procurement have been utilised. The allocation towards capital outlay for defence services has risen steadily, marking an approximate 60% increase over the past five years.
Officials said the current rate of expenditure, coupled with several large projects nearing approval, positions the ministry to fully utilise its budget allocation by the end of the fiscal year. Concurrently, the MoD is preparing its budgetary projections for the upcoming revised estimates.
